FCC pays $340K yearly to wire hundreds of empty Adak Island buildings

A ProPublica and Anchorage Daily News investigation published Monday found that the Universal Service Fund pays Adak Eagle Enterprises more than $340,000 annually to maintain fiber connections to hundreds of mostly abandoned buildings on Adak Island, where the roughly two dozen residents rely primarily on unsubsidized Starlink rather than the company's subsidized service. Starlink arrived in 2023 and offers far faster speeds than Adak Eagle's subsidized 1 to 10 megabits per second. The company has collected $7.35 million in combined federal and state subsidies since 2016, including $3.6 million in federal broadband subsidies and $3.75 million from the Alaska Universal Service Fund. In 2022, the FCC reduced Adak Eagle's required service locations from 346 to 306 without cutting the subsidy, a reflection of how the high-cost program ties support obligations to service areas rather than current subscriber counts; the FCC's stated goal is preserving network availability in places where market forces alone would not sustain service. A 2013 federal order determined company president Larry Mayes spent telecom subsidy money on a fleet of vehicles and a fishing boat that weren't necessary for his business, and that the $237,455 salary Mayes paid himself one year was "unreasonable" and "disproportionate" given the size of the company and what's typical for Anchorage, where he lives; the FCC continued funding the company afterward.