Free, reduced mobile service coming for low-income South DakotansPIERRE — State regulators gave their approval Tuesday to a company that wants to be first in South Dakota to offer federally subsidized wireless telephone service to low-income households.
By: Bob Mercer, Republic Capitol Bureau
PIERRE — State regulators gave their approval Tuesday to a company that wants to be first in South Dakota to offer federally subsidized wireless telephone service to low-income households.
Budget Prepay, based in Bossier City, La., plans do business under the name of Budget Mobile and will use Verizon and Sprint as its underlying carriers.
The two service packages that Budget Prepay plans to offer would be available only for low-income households in non-rural areas of South Dakota.
One service package would be free to qualifying customers and allow up to 250 minutes of calling time per month. The other service package would cost $25 per month and allow up to 4,000 minutes of voice and texts per month. Each text counts as one minute of voice.
In both instances the company would receive a $9.25 federal subsidy per customer. The company provides a free handset to each customer. Only one Lifeline subsidy is allowed per household by federal law.
The company also plans to offer additional-minutes packages at various prices.
All of the geographic areas that Budget Mobile has identified currently are territories covered by CenturyLink with land-line telephone services. The $9.25 subsidy is technically a federal benefit through the Lifeline program.
Lifeline is available for households that receive some type of government economic assistance, such as Medicaid and other social services program. Lifeline also is available generally for households with income at or below 135 percent of federal poverty level.
The company plans to open stores in South Dakota selling its services.
The state Public Utilities Commission voted 3-0 Tuesday to designate Budget Prepay as a Lifeline-only eligible telecommunications carrier. “While I have concerns I will support the motion,” PUC Chairman Chris Nelson said.
The designation was necessary for Budget Prepay to qualify for the subsidy program from the Federal Communications Commission.
The company’s business model in general is centered on low-cost prepaid service.
The company already is offering or plans to offer Lifeline mobile services in Arkansas, Kentucky, Louisiana, Maryland, Rhode Island, Wisconsin, Nevada, Pennsylvania and Michigan, according to the company’s South Dakota application.
Another company, True Wireless, based in Bartlett, Tenn., has filed for South Dakota authority as part of its plan to offer Lifeline service nationwide. The commission hasn’t taken up its application yet.