The digital divide in the United States continues to be a significant barrier to opportunity, particularly for low-income households. Following the expiration of the federal Affordable Connectivity Program (ACP) in May 2024, states are increasingly stepping in to ensure residents maintain access to affordable broadband internet. New Mexico has emerged as a leader in this effort, swiftly enacting legislation to replace the ACP with a state-level program, demonstrating a commitment to digital equity and access. This rapid response – from bill filing to enactment in just 25 days – offers a potential model for other states grappling with the fallout from the ACP’s demise.
The ACP, launched in 2022, provided eligible households with discounts of up to $30 per month on internet service, and up to $75 per month for households on qualifying Tribal lands. More than 23 million Americans benefited from the program before its funding lapsed, highlighting its widespread impact. The program’s end left millions facing higher internet bills, potentially exacerbating existing inequalities in education, healthcare, and employment. The reasons behind the ACP’s funding lapse are complex, with Republican lawmakers citing concerns over cost and a desire for program reform, while Democrats argued the program was vital for bridging the digital divide. A report by The Brattle Group found that the ACP generated between $28.9 and $29.5 billion in savings annually, thanks to expanded access to remote work, education, and telehealth services, effectively offsetting its $7-8 billion annual cost.
New Mexico’s Swift Response: The Low-Income Telecommunications Assistance Program
Recognizing the urgent need to address the affordability gap, New Mexico lawmakers moved quickly to establish a state-funded alternative. Senate Bill 152, filed on January 26, 2026, by State Senator Michael Padilla, a Democrat representing Albuquerque, was signed into law on February 12, 2026, after passing both houses of the state legislature with unanimous support (38-0 in the Senate). The legislation updates the state’s Rural Telecommunications Act and empowers the New Mexico Public Regulation Commission (PRC) to administer the Low-Income Telecommunications Assistance Program (LITAP). The speed with which the bill progressed – 25 days from introduction to enactment – underscores the bipartisan commitment to ensuring affordable broadband access for New Mexicans.
LITAP will provide up to $30 per month to qualified low-income households to offset the cost of internet service. The program is slated to launch in July 2026 and is projected to cost approximately $10 million in its first year, increasing to $42 million annually thereafter. Crucially, LITAP will not rely on taxpayer funding. Instead, it will be financed through the state’s universal service fund (SRUSF), funded by a small $1.50 fee on existing telecom services. This funding mechanism aims to provide a sustainable and dedicated revenue stream for the program, minimizing the burden on state general funds.
Funding and Sustainability of LITAP
The decision to fund LITAP through the SRUSF is a key aspect of its long-term viability. The SRUSF is designed to support telecommunications infrastructure and services in underserved areas of New Mexico. By leveraging this existing fund, the state avoids the need to allocate additional taxpayer dollars to the program. This approach also aligns with the broader goal of ensuring equitable access to essential services, particularly in rural and tribal communities where broadband access has historically been limited. The New Mexico PRC will oversee the administration of LITAP, ensuring that funds are distributed efficiently and effectively to eligible households. Details regarding eligibility criteria and the application process are expected to be released by the PRC in the coming months.
The Broader Context: Federal Inaction and State-Level Solutions
New Mexico’s proactive approach stands in stark contrast to the federal government’s inaction regarding the ACP. The program’s funding lapse stemmed from a failure to secure additional congressional appropriations. While the Federal Communications Commission (FCC) continues to explore potential funding mechanisms, including future spectrum auctions, its authority to auction spectrum has been limited since March 9, 2023. This legislative roadblock has hampered efforts to replenish the ACP’s funding and restore benefits to millions of Americans. The FCC, under Chairwoman Jessica Rosenworcel, has advocated for continued funding and expansion of affordability programs, recognizing their critical role in promoting digital inclusion. In February 2026, the FCC announced it was seeking comment on how to expand programs modeled after the ACP to provide greater support for affordability.
The demise of the ACP has prompted a wave of concern among advocates for digital equity. Without affordable internet access, low-income households face significant disadvantages in accessing essential services, pursuing educational opportunities, and participating in the modern economy. The Brattle Group’s report underscores the economic benefits of programs like the ACP, demonstrating that the program’s costs are more than offset by the increased economic activity and social benefits it generates. The report highlights the positive impact on remote work, online education, and telehealth services, all of which contribute to increased earnings and improved quality of life for low-income individuals and families.
The Role of Competition and Monopoly Power
While programs like LITAP provide a crucial safety net for low-income households, addressing the underlying issue of high broadband prices is essential for long-term affordability. A lack of competition in the broadband market allows large regional monopolies to maintain high prices and limit consumer choice. Many advocates argue that increased competition, through measures such as promoting municipal broadband networks and strengthening antitrust enforcement, is necessary to drive down prices and improve service quality. Open access fiber projects, where communities own the infrastructure and allow multiple providers to offer service, are also gaining traction as a potential solution. These initiatives can empower local communities and foster innovation in the broadband market.
The current situation highlights a broader systemic issue: the influence of powerful telecom monopolies on policymakers. For decades, these companies have lobbied against regulations that would promote competition and protect consumers. This has resulted in a market characterized by limited choice, high prices, and subpar service. Addressing this issue requires a fundamental shift in policy, prioritizing the public interest over the profits of a few large corporations. Strengthening antitrust laws, empowering community-based alternatives, and establishing robust consumer protections are all essential steps towards creating a more equitable and competitive broadband market.
New Mexico’s rapid enactment of LITAP serves as a beacon of hope in the wake of the ACP’s expiration. It demonstrates that states can grab decisive action to protect their residents from the digital divide. However, the long-term success of LITAP, and similar state-level initiatives, will depend on sustained funding, effective administration, and a broader commitment to addressing the underlying issues of affordability and competition in the broadband market. The program is scheduled to begin accepting applications in July 2026, and the New Mexico PRC will be releasing further details on eligibility requirements and the application process in the coming weeks.
As other states consider similar measures, New Mexico’s experience offers valuable lessons. Swift legislative action, dedicated funding mechanisms, and a commitment to digital equity are all essential ingredients for success. The future of affordable broadband access in the United States may well depend on the willingness of states to step up and fill the void left by federal inaction.
Key Takeaways:
- New Mexico has launched LITAP, a state-level program to replace the federal ACP, providing up to $30/month in broadband assistance to eligible low-income households.
- LITAP is funded by the state’s universal service fund (SRUSF), avoiding reliance on taxpayer dollars.
- The program was enacted remarkably quickly – in just 25 days – demonstrating strong bipartisan support.
- The ACP’s expiration highlights the need for state-level solutions and a broader focus on competition and affordability in the broadband market.
- The Brattle Group’s report indicates that programs like the ACP generate significant economic benefits, exceeding their costs.