On Adak Island in the Bering Sea, 1,200 miles from Anchorage, Alaska, an abandoned house on a former Navy base sits empty with broken windows and no furniture. Yet federal subsidies pay more than $340,000 per year to provide this single building and hundreds of others with internet access that residents say they do not use.
The funding comes from the Federal Communications Commission's Universal Service Fund, a program financed by fees added to nearly every American's phone bill. The fund is intended to bring affordable broadband to remote communities. A joint investigation by ProPublica and the Anchorage Daily News found that Adak Eagle, the local telecom serving the island, receives substantial subsidies for infrastructure connecting buildings where almost no one lives.
The island's population peaked decades ago when it housed thousands of Navy personnel and their families. After the base closed in 1997, residents left. The state estimated the population at 77 last year, while residents themselves say closer to two dozen people remain on the island.
Reporters visited every building Adak Eagle told regulators it serves during a June trip to the island. They knocked on doors and spoke with everyone they could find. Not a single resident said they subscribe to the subsidized internet service. Instead, residents use Starlink, Elon Musk's satellite internet service, which arrived in 2023 without FCC subsidies.
What the Right Is Saying
Conservative defenders of the subsidy program argue that maintaining connectivity infrastructure in remote Alaska serves national security and strategic interests. They contend that even if few people live on Adak now, the island's location along the Aleutian chain makes it important to retain communications capability for potential future needs or emergencies.
Some Republican lawmakers from rural states have pushed back against proposals to reduce rural broadband subsidies, arguing that private markets cannot profitably serve remote populations. They note that without federal support, Alaska villages and frontier communities would have no internet service at all, leaving residents disconnected from modern economy and emergency communications.
Industry representatives say satellite alternatives like Starlink are not reliable substitutes for ground-based infrastructure in all conditions. They argue that the Universal Service Fund provides essential redundancy and that dismantling fiber networks serving remote areas would be shortsighted even if current subscriber counts are low.
What the Left Is Saying
Progressive critics point to Adak as evidence of systemic failure in federal broadband spending oversight. They argue that the Universal Service Fund has become a vehicle for subsidizing outdated infrastructure and enriching telecom executives with minimal accountability to taxpayers or actual consumers.
Senator from Alaska and other Democratic lawmakers have called for stronger audit requirements and periodic reviews of whether subsidized areas still need service. They note that Adak Eagle President Larry Mayes was found by a 2013 federal order to have spent subsidy money on vehicles and a fishing boat not necessary for business operations, with his $237,455 annual salary deemed unreasonable given the company's size.
Consumer advocacy groups argue that the FCC should condition continued subsidies on proof of actual service usage. They say it is indefensible to spend hundreds of thousands per building annually when no subscribers benefit from the connections. The Electronic Frontier Foundation and Public Knowledge have cited Adak as emblematic of broader problems with how rural broadband programs are administered.
What the Numbers Show
Adak Eagle has received $3.6 million from the federal broadband subsidy program since 2016, according to FCC records reviewed by ProPublica and the Anchorage Daily News. The company also collected $3.54 million through a separate FCC program that replaced revenue phone companies once earned from long-distance calls.
The state of Alaska contributed an additional $3.75 million through its own broadband subsidy programs to Adak Eagle, bringing total public funding since 2016 to approximately $10.9 million for an island with roughly two dozen residents. That works out to roughly $14,000 per person annually in subsidies.
By 2011, the company was collecting $2.68 million annually from the Universal Service Fund alone. Adak Eagle's current website advertises internet plans ranging from $99 to $550 per month for customers, on top of its subsidy payments. Residents told reporters they pay $90 to $140 monthly for Starlink service.
A 2013 federal order found that Mayes spent telecom funds on a fleet of vehicles and a fishing boat deemed unnecessary for business operations. The FCC also determined his salary was disproportionate given company size and Anchorage norms, where he lives while managing the remote island operation.
The Bottom Line
The Adak situation raises questions about how the FCC verifies that subsidy recipients actually serve the communities they claim to cover. The commission continues funding telecom companies even when buildings sit empty and no subscribers use the services being subsidized.
GCI, Alaska's largest telecom, received continued subsidies after signing a settlement for alleged fraud related to the program. A Fairbanks company continued receiving payments while its owner served federal prison time for tax evasion. These cases suggest oversight mechanisms may be insufficient to prevent misuse of Universal Service Funds.
Residents using Starlink without subsidy illustrate how market alternatives can emerge even in remote locations, raising questions about whether continued public funding serves a genuine need or merely props up outdated infrastructure. What happens next depends on whether Congress chooses to reform FCC broadband subsidy accountability requirements.