The Biden Administration recently released its plans for allocating more than $42.45 billion in broadband funding to all 50 states through the Broadband Equity Access and Deployment ("BEAD") Program. These dollars will be used by each state to issue broadband funding awards to subgrantees – including commercial ISPs, government-owned network operators, and nonprofits – to deploy broadband to unserved and underserved areas.
This announcement begins a process for states and territories to finalize their proposed plans for issuing funding to subgrantees ("Initial Proposals") following an application, challenge, and public comment period. States and territories must submit their Initial Proposals to NTIA by December 1, 2023, and, once approved, will allow each jurisdiction to access up to 20 percent of their allocated BEAD funds. Entities seeking broadband funding through this Program should begin to prepare for this unique opportunity and should monitor developments in the jurisdictions where they are interested in providing service to ensure they can prepare for funding procedures that may be decided in each state's planning and implementation process.
The BEAD Program was designed to expand high-speed internet access by funding broadband infrastructure deployment and adoption programs and planning in all states and territories. Established by the Infrastructure Investment and Jobs Act, this federal grant program is focused on providing all Americans with access to broadband by funding partnerships between states or territories, communities, and stakeholders to build infrastructure and increase high-speed internet adoption. The BEAD Program prioritizes areas that have no internet access or that only have access to speeds less than 25/3 Mbps ("unserved locations") and areas that only have access to speeds less than 100/20 Mbps ("underserved locations").
Federal and State Collaboration
Congress directed the Department of Commerce through NTIA to distribute the $42.45 billion in allocated funding. Work began in 2022 when NTIA issued a Notice of Funding Opportunity that provided information and a framework for the states and territories on the requirements of BEAD-related grant programs. After engaging in a public outreach campaign, NTIA then sought letters of intent from states and territories on May 13, 2022. NTIA also provided funding during the early stages to support a variety of planning and pre-deployment activities, such as research and data collection to identify unserved and underserved locations.
The FCC has identified each jurisdiction's unserved and underserved locations by collecting broadband coverage data from fixed broadband ISPs. Thereafter, the agency used this data to facilitate the development of granular, detailed fixed broadband deployment maps, which were open to a challenge process and then updated to create final versions of each jurisdiction's unserved and underserved locations for BEAD funding purposes.
On June 30, NTIA announced its BEAD funding allocation to each state and territory, with amounts ranging from $3.3 billion (Texas) to $27.1 million (U.S. Virgin Islands). Nineteen states will receive more than $1 billion each in funding, including Alabama, California, Georgia, Louisiana, Michigan, Missouri, North Carolina, Texas, Virginia, and Washington. A complete list detailing each jurisdiction's BEAD funding award is available at internetforall.gov.
By December 1, 2023, each state and territory must submit an Initial Proposal describing how their BEAD-related grant program will be administered. Each state and territory is required to solicit public comment on the draft of its Initial Proposal to ensure community engagement and input. Certain states, such as Louisiana and Virginia, have already received public comments on their Initial Proposal drafts. However, most states and territories have not yet publicly disclosed their drafts for public comment, but will likely do so in the very near future. A full list of states and territories that are currently soliciting public comment on their draft Initial Proposals will be available on NTIA's reference page.
Following a jurisdiction's submission of its Initial Proposal, NTIA will review and, after approval, authorize the state or territory to request access to at least 20 percent of its allocated funds, which can be used to fund the required challenge process or to fully fund deployment projects that consist of at least 80 percent unserved locations and are in areas where a greater than average number of individuals are living below 150 percent of the poverty line. NTIA's approval of the Initial Proposal will also initiate the one-year shot clock for completing the jurisdiction's subgrantee evaluation and selection and challenge processes. During this time, each state and territory will also be required to submit its final proposal to NTIA describing how it complied with the Initial Proposal and the results of its subgrantee selection and challenge processes.
Practical Considerations for ISPs Considering Whether to Pursue BEAD Funding
With each state and territory now on the clock with respect to their submission of Initial Proposals, any entity interested in grant program participation should monitor NTIA's reference page and determine when an individual jurisdiction's draft Initial Proposal will be released for public comment. Interested parties should also consider whether it is in their interest to submit comments on any particular jurisdiction's Initial Proposal.
Further, providers should begin evaluating those eligible areas in each jurisdiction to determine: (i) where that provider may be interested in further expanding its broadband services or client base; or (ii) to the extent the provider already serves specific areas, where challenge efforts will likely need to be focused. Additionally, providers should make sure they understand each jurisdiction's existing broadband grant programs along with relevant details about each respective broadband office or agency authorized to implement the BEAD program. In most states and territories such programs and offices will be integral to the jurisdiction's BEAD funding plans and how it will administer its BEAD-related grant program funding.
DWT advises ISPs on broadband funding opportunities, risks, and challenges. Please let us know if you would like assistance in monitoring a specific jurisdiction's release of its draft Initial Proposal or have questions regarding how a particular jurisdiction's BEAD-related funding plans may impact your business.