The U.S. House of Representatives passed a $1.2 trillion infrastructure bill after months of political wrangling, sending the legislation to President Joe Biden’s desk for his signature. Here’s a look at what that means for broadband in the country going forward.
The infrastructure legislation (formally known as the Infrastructure Investment and Jobs Act) includes a total of $65 billion for broadband, which will be distributed through a variety of programs. The largest is the $42.45 billion Broadband Equity, Access and Deployment (BEAD) program, which will funnel money through the states to fuel deployments in un- and underserved areas. Areas are considered unserved if they lack access to broadband service offering download speeds of 25 Mbps and upload speeds of 3 Mbps.
Under the BEAD program, each state will receive an initial allocation of $100 million to be used for broadband grants, with additional funding to be distributed based on coverage maps put out by the Federal Communications Commission (FCC). In order to receive funding, each state must submit a five-year action plan, which identifies locations that should be prioritized for support, outlines how best to serve unconnected locations and assesses how long it would take to build out universal broadband.
To ensure efficient distribution of the federal money, the program permits each state to use up to 5% of its total funding allocation for administrative activities. Those may include research and data collection to identify un- and un-derserved areas, establishing or expanding a state broadband office, training employees or engaging in community outreach.
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The BEAD program specifies state-level grant opportunities must be open to cooperatives, non-profits, public-private partnerships, private entities, utilities and local governments alike. Grant recipients are required to deliver service offering speeds of 100 Mbps downstream and 20 Mbps upstream and provide at least one low-cost service plan for subscribers. Awardees must complete their network deployment and begin providing broadband service within four years of the date they receive grant funding unless they meet specific criteria for an extension.
The infrastructure bill also includes several other broadband initiatives. It allocates $14.2 billion for an Affordable Connectivity broadband subsidy program, which is set to replace the FCC’s existing Emergency Broadband Benefit program. The bill also sets aside $2.75 billion for a Digital Equity program; $2 billion for a Tribal Broadband Connectivity Program; $2 billion for the Rural Utilities Service Distance Learning, Telemedicine and Broadband Program; and $1 billion for a new Middle Mile grant program.
What now?
Congress gave the National Telecommunications and Information Administration (NTIA) 180 days to set up the BEAD program.
There is some uncertainty about how things will play out going forward. But Kim Bayliss, principal at the Washington, D.C. lobby firm Perry Bayliss, told Fierce she expects money to begin flowing to the states within the next six to 10 months, though the bulk of federal funding is contingent on the FCC’s yet-to-be-released maps.
“My guess is that they will try their best to get money out the door to at least those states that are really well organized and have planned ahead before next year’s election,” she said, adding states with existing broadband offices and maps will likely be able to move the quickest to begin awarding grants.
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In terms of competition for BEAD funding, Bayliss said “What I’m hearing from people is there’s probably not anybody who’s going to be going after this money in a national way…they’re going to be focused on what states they serve and what the needs are in those states.”
She suggested companies that are either new to the broadband industry or have not put in the work engaging with state policymakers may have a harder time securing grants.
“I think states are going to want to be really, really careful about making sure this money is spent wisely and properly,” Bayliss explained. “This is the last effort for the federal government to try to really bridge the digital divide and so the pressure is on for these states to really accomplish that task.”
Response
Biden hailed the infrastructure bill’s passage as a “a monumental step forward” for the nation. Broadband industry groups including the Fiber Broadband Association, NCTA – The Rural Broadband Association, the Wireless Internet Service Providers Association, the National Rural Electric Cooperative Association and the Competitive Carriers Association similarly celebrated, but acknowledged much work remains ahead.
Gary Bolton, head of the Fiber Broadband Association, said in a statement “We now need to move our focus from Congress to NTIA and the state and local level. Only 26 states currently have broadband offices, and other states have a designate, which is typically a multi-agency broadband task force. And, while 40 states currently have broadband programs, these state broadband programs vary widely.”
He said the group is working to develop a playbook of best practices for state broadband programs and expects to work “closely with both NTIA and the FCC in 2022.”
NCTA CEO Shirley Bloomfield said in her own statement “Implemented properly, this investment should go great distances toward connecting the millions of rural consumers who still need reliable, sustainable and affordable access.”
She urged state and federal policymakers to “invest in future-proof scalable technology like fiber, and to partner with small, community-based local exchange providers – regardless of their corporate structure – who have already proven their ability and commitment to build and maintain strong networks in rural areas.”