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March/April 2022 Issue

Also in this issue: Enforceable State PFOS/PFOA Drinking Water Standards Likely This Year     |     Wisconsin Legislature Initiates Unclaimed Property Voluntary Disclosure Agreements

It’s a Good Time to Consider Community Broadband

In its historic Infrastructure Investment and Jobs Act, Congress recognized that “[a]ccess to affordable, reliable, high-speed broadband is essential to full participation in modern life in the United States.” The Infrastructure Act, signed into law late last year, sets aside an unprecedented 65 billion dollars for broadband funding. While past funding opportunities for broadband have largely focused on private enterprise, these new federal grant programs make broadband funds available to local governments and municipal utilities as well. If your community has been considering municipal broadband (or even if it hasn’t), now may be the time to act.

While the Infrastructure Act contains a variety of programs aimed at expanding broadband access, the Broadband Equity Access and Deployment Program (“BEAD”) is the largest and most promising source of funding for municipalities looking to expand broadband access in their communities. The BEAD program devotes $42.45 billion to support projects to construct and deploy broadband networks, with a focus on expanding broadband in unserved and underserved areas.

BEAD will be administered by the National Telecommunications and Information Administration (“NTIA”), which will make direct grants of at least $100 million to each state, with the remainder allocated among the states based on the number of unserved high-cost areas in each state. The states will then make sub-grants to eligible entities, which include local governments, utilities, and public-private partnerships, as well as private businesses, to fund broadband projects. 

BEAD funds may be used for:

  • broadband projects targeting unserved and underserved areas;
  • broadband projects connecting eligible community anchor institutions such as schools, libraries, public safety entities, and hospitals; 
  • data collection, broadband mapping, and planning;
  • installing internet and Wi-Fi infrastructure or providing reduced-cost broadband within certain unserved or high-poverty multi-family residential buildings; and
  • broadband adoption, including programs to provide affordable internet-capable devices 

In awarding funding, states must first prioritize unserved service projects, in which 80% or more of the locations served by the project do not have access to reliable broadband service at speeds of at least 25 megabits per second (Mbps) for downloads and 3 Mbps for uploads. After ensuring coverage of all unserved areas, states may then award funds to underserved service projects (in which 80% or more of the locations served by the project do not have access to reliable broadband service at speeds of at least 100 Mbps for downloads and 20 Mbps for uploads) and then to projects connecting eligible community anchor institutions. In awarding funds, states must also prioritize projects in persistent poverty counties or high-poverty areas and consider factors such as the speeds of the proposed broadband service and how long it will take the project to be completed. 

In general, grant recipients must provide a matching contribution of 25% of the project costs. However, the match may consist of funds received by the grantee under the CARES Act, the Consolidated Appropriations Act of 2021, or the American Rescue Plan Act, and may also include in-kind contributions.

Broadband networks constructed with BEAD funds must provide reliable broadband service at a speed of not less than 100 Mbps for downloads and 20 Mbps for uploads and must provide access to every customer served by the project who desires broadband service. Grant recipients must begin providing broadband service within four years of receiving the grant, must offer at least one low-cost broadband service option for eligible subscribers, and must carry out public awareness campaigns within the project’s service area that are designed to highlight the value and benefits of broadband service. If at any time a grantee is no longer able to provide broadband service to the areas covered by the grant, it must sell the network capacity at a reasonable, wholesale rate on a nondiscriminatory basis to other broadband service providers or public sector entities.

There are a number of variables that will affect the timeline for the distribution of BEAD funds, including how quickly the FCC finishes its new broadband DATA maps, which are still under development. While NTIA must issue a notice of funding opportunity to the states by mid-May, 2022, the states will not be able to submit proposals for grants to the NTIA until after the FCC’s broadband maps are complete, likely sometime in 2022. Each state will develop its own process and timeline for awarding BEAD funds for individual broadband projects, subject to the requirements set out in the statute and imposed by the NTIA, but money is not likely to start flowing until 2023. Nevertheless, the time to begin planning an application for BEAD funds is now.

— Julia K. Potter & Anita T. Gallucci

This newsletter is published and distributed for informational pur- poses only. It does not offer legal advice with respect to particular situations, and does not purport to be a complete treatment of the legal issues surrounding any topic. Because your situation may differ from those described in this Newsletter, you should not rely solely on this information in making legal decisions.

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