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July 13, 2023

State Broadband Funding Awards Announced; Another Step Toward Universal Broadband in the U.S.

At a Glance

  • More than $40 billion in funding was awarded for contracts bringing broadband service to unserved and underserved locations.
  • Each state must now propose a framework for its subgrant application and review processes, known as an Initial Proposal.
  • Entities with business or other operations in individual states, particularly those in less urban areas, would do well to follow the engagement process and development of state broadband Initial Proposals.

In late June, the Biden administration took the widely anticipated step of announcing initial financial award amounts made under the auspices of the Infrastructure, Investment and Jobs Act (IIJA) Broadband Equity, Access and Deployment program, or BEAD, to each state and U.S. territory. These funds, totaling over $40 billion, are to be used by individual states and territories to award contracts for the building of broadband networks in unserved and underserved locations as identified by the Federal Communications Commission in its nationwide broadband availability mapping process, summarized in our previous alert.

The announcement by the National Telecommunications and Information Administration (NTIA), an arm of the U.S. Commerce Department, of state specific award amounts represents a kickoff point for the next phases of the sprawling, multi-year BEAD infrastructure program. Each state’s broadband planning office now must work to complete their research about baseline broadband service levels in their geographic footprint and comprehensively identify all community anchor institutions (CAIs) that might benefit from better broadband capacity. They must publicize this information as well as delineate a “challenge” process under which stakeholders may provide the state with evidence that an area or a CAI has been incorrectly categorized or included or excluded from the state’s roster. Each state must also propose a framework for its grant application and review processes, known as an Initial Proposal, and file it with NTIA by the end of November 2023. This Initial Proposal must describe how the state intends to administer its grant processes and program oversight. These plans are to be made available for public comment as the law requires public vetting of these state-initiated grant proposal frameworks and NTIA review for their consistency with the BEAD program.

Once NTIA has approved a state’s Initial Proposal, the state is free to initiate its application process for the award of subgrants to build and operate broadband networks. States will have a year to collect applications, potentially de-conflict proposals with overlapping geographies and award BEAD subgrants. Each state’s selections will be reflected in a Final Proposal that identifies specific projects the state has selected and that is submitted to NTIA. The subgrantees in turn will have to commit to a range of program requirements and oversight to be awarded funding, including in most cases providing at least 25% of the funding of the estimated costs of their proposed projects.

In terms of where the awards were allocated, states with the most rural unserved areas were granted more funding than were more geographically compact states. For example, Texas was awarded over $3.3 billion in BEAD funding, and California garnered $1.8 billion. Alabama, Georgia, Louisiana, Michigan, Missouri and North Carolina also received significant awards. Smaller states such as Delaware received a baseline award amount of $107.7 million.

Entities with business or other operations in individual states, particularly those in less urban areas, would do well to follow the engagement process and development of state broadband Initial Proposals. Those in a position to participate in broadband infrastructure development and connection should be engaging with state broadband offices to provide their perspectives on how best to fashion the framework for each state’s grant process.

The material contained in this communication is informational, general in nature and does not constitute legal advice. The material contained in this communication should not be relied upon or used without consulting a lawyer to consider your specific circumstances. This communication was published on the date specified and may not include any changes in the topics, laws, rules or regulations covered. Receipt of this communication does not establish an attorney-client relationship. In some jurisdictions, this communication may be considered attorney advertising.

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