Lifeline Telephone Program: Frequently Asked Questions

Angele A. Gilroy
Specialist in Telecommunications Policy

Mark Gurevitz
Information Research Specialist

The concept that all Americans should have affordable access to the telecommunications network, commonly called the “universal service concept,” can trace its origins back to the 1934 Communications Act. The preservation and advancement of universal service has remained a basic tenet of federal communications policy, and in the mid-1980s the Federal Communications Commission (FCC) established the Lifeline program to provide support for low-income subscribers. The Lifeline program, which is administered under the Universal Service Fund (USF) Low Income Program, was established by the FCC in 1984 to assist eligible low-income subscribers to cover the recurring monthly service charges incurred for telephone usage. Although the program solely covers costs associated with the minutes of use, not the telephone, misinformation connecting the program to payment for a “free phone” has resulted in a significant number of constituent inquiries.


Date of Report: December 3, 2012
Number of Pages: 6
Order Number: R42846
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Video Relay Service: Program Funding and Reform

Patricia Moloney Figliola
Specialist in Internet and Telecommunications Policy

The Federal Communications Commission (FCC) regulates a number of disability-related telecommunications services, including video relay service (VRS). VRS allows persons with hearing disabilities, using American Sign Language (ASL), to communicate with voice telephone users through video equipment, rather than through typed text. VRS has quickly become a very popular service, as it offers several features not available with the text-based telecommunications relay service (TRS).

In June 2010, the FCC began a comprehensive review of the rates, structure, and practices of the VRS program. The goal of the review is to reform the VRS program, which had long been burdened by waste, fraud, and abuse, and by compensation rates that had become inflated above actual cost. Most recently, in October 2012, the FCC asked for input on how it might improve the technology used by users and operators of the VRS program and update VRS rates.

Congressional interest in the VRS Program is two-fold: eliminating fraud and abuse in the program and maintaining the usefulness of the program for users. Controversy has arisen over the latest proposals for change to the program being considered by the FCC. The FCC believes that rate structure changes are needed to reduce fraud and better manage the VRS program, but the deaf and hard-of-hearing community is concerned that funding cuts will result in fewer and lessqualified ASL interpreters. Additionally, the FCC has proposed changing the technologies used to operate and use the system, but the community is concerned that changes in technology will decrease the quality of the system as it is now and also potentially pose challenges to some users.


Date of Report: December 4, 2012
Number of Pages: 9
Order Number: R42830
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Offsets, Supplemental Appropriations, and the Disaster Relief Fund: FY1990-FY2013

William L. Painter
Analyst in Emergency Management and Homeland Security Policy

This report discusses the recent history of offsetting rescissions in paying for supplemental appropriations to the Federal Emergency Management Agency’s Disaster Relief Fund (DRF).

As Congress has debated the growing size of the budget deficit and national debt in recent years, efforts have intensified to control spending and offset the costs of legislation. In 1995, 2011, and again in 2012, the question of offsetting disaster relief spending emerged in congressional debate. In 2011, a series of disasters threatened to deplete the DRF, which is the primary source of assistance to state and local governments as well as individuals in the wake of disasters.

Hurricane Sandy struck the east coast of the United States on October 29, 2012. The storm caused tens of billions of dollars in damage along the coast. As damage estimates became public in the weeks after the storm, calls for supplemental appropriations to help pay for recovery efforts were met with calls for offsets from some quarters. On December 7, 2012, the Administration released a request for $60.4 billion in supplemental appropriations in connection with Hurricane Sandy, including $11.5 billion for the DRF. The preamble to the request opposed offsetting the cost of the legislation.

Traditionally, supplemental disaster relief funding has been treated as emergency spending, not counted against discretionary budget caps, and not requiring an offset. However, supplemental spending packages have at times carried rescissions that have offset, to one degree or another, their budgetary impact. In some instances, the supplemental spending packages have contained both appropriations for the DRF and offsetting rescissions.

This report examines the use of offsets in connection with supplemental funding for the DRF since FY1990, reviewing three specific incidences where bills that had an impact on the level of funding available in the DRF were fully offset, and points out a number of issues Congress may wish to consider in this debate.

Since FY1990, there has only been one case in which supplemental funding for the DRF was completely offset by rescissions.


Date of Report: December 10, 2012
Number of Pages: 21
Order Number: R42458
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Emergency Management: A Compendium

This Compendium provides details on the National Environmental Policy Act (NEPA) for disaster response, recovery, and mitigation projects. It discusses the role of the United States Fire Administration. A section on nuclear power plants point to their vulnerabilities. The Emergency Planning and Community Right-to-Know Act and the major regulatory programs that mandate reporting by industrial facilities of releases of potentially hazardous chemicals to the environment, as well as local planning to respond in the event of significant releases are summarized. The traditional funding for major disaster declarations, both through annual requested amounts and through supplemental appropriations to meet greater than anticipated costs. Also explained are the workings of the President’s Disaster Relief Fund, a “no-year” fund that finances spending under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (P.L. 93-288).

Project Bioshield (P.L. 108-276), which provides the federal government with new authorities related to the development, procurement, and use of medical countermeasures against chemical, biological, radiological, and nuclear terrorism agents, is outlined.

The agricultural sector is not exempt from disaster and this Compendium provides an overview of the current U.S. Department of Agriculture disaster assistance programs -- federal crop insurance, noninsured crop disaster assistance, and emergency disaster loans.


Date of Report: December 17, 2012
Number of Pages: 162
Order Number: C-12013
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The Hatch-Waxman Act: Over a Quarter Century Later

Wendy H. Schacht
Specialist in Science and Technology Policy

John R. Thomas
Visiting Scholar

Congressional interest in health-related issues has refocused attention on legislative efforts to provide both new as well as lower-cost pharmaceuticals for the marketplace. P.L. 98-417, the Drug Price Competition and Patent Term Restoration Act of 1984 (commonly known as the Hatch-Waxman Act), made significant changes to the patent laws as they apply to pharmaceutical products in an attempt to balance the need for innovative new drugs and the availability of less expensive generic products. The act created several practices intended to facilitate the marketing of generic drugs while permitting brand name companies to recover a portion of their intellectual property rights lost during the pharmaceutical approval process. Twenty-five years later, the impact of the act on the pharmaceutical industry may have implications for current congressional efforts to facilitate the development of new, inventive products while reducing costs to consumers.

Prior to the implementation of the Hatch-Waxman Act, 35% of top-selling drugs had generic competitors after patent expiration; now almost all do. The Generic Pharmaceutical Association points out that of 12,751 drugs listed in the Orange Book, 10,072 have generic substitutes available to consumers. Concurrently, the time to market for these generic products has decreased substantially. According to the Congressional Budget Office, in 1984 the average time between the expiration of a patent on a brand name drug and the availability of a generic was three years. Today, upon FDA approval a generic may be introduced immediately after patents on the innovator drug expire as companies are permitted to undertake clinical testing during the time period associated patents are in force. In cases where the generic manufacturer is the patent holder, a substitute drug may be brought to market before the patent expires. Industry support for pharmaceutical research and development has grown since the passage of the legislation although some recent figures indicate reduced R&D spending by several companies.

In the absence of the research, development, and testing performed by the brand name pharmaceutical companies, generic drugs would not exist. The provisions of the Hatch-Waxman Act permit the generic industry to rely on information generated and financed by the brand name companies to obtain approval for their product by the FDA. However, the pharmaceutical industry today differs significantly from what it was in the early 1980s when the legislation was enacted. The cost of developing a drug has doubled, as has the number of clinical trials necessary to file a new drug application. The number of participants required for these trials has tripled. As the rate of return on investments in a new drug declined 12%, manufacturers often spend R&D dollars on developing improved versions of, or new delivery methods for an existing product.

Many experts agree that the Drug Price Competition and Patent Term Restoration Act has had a significant effect on the availability of generic substitutes for brand name drugs. Yet, congressional concerns remain whether or not the balance inherent in the act remains appropriate over 25 years later.


Date of Report: December 5, 2012
Number of Pages: 20
Order Number: R41114
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