California Gov. Gavin Newsom Proposes $2 Billion Cut In Broadband Projects
The proposal would represent a setback to the state's broadband ambitions.
May 14, 2024 — California Gov. Gavin Newsom on Friday proposed cutting $2 billion from broadband projects that would have increased internet access throughout the state in order to balance the state budget.
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Speaking about California’s ambitious middle mile broadband program, the Democrat Newsom said: “These are programs, propositions that I’ve long advanced – many of them…. But you’ve got to do it. We have to be responsible. We have to be accountable.”
“We are disappointed to see this rollback,” Cristal Mojica of the Michelson Center for Public Policy, told LAist.
Advocates for digital equity said the decision may compromise attempts to reach some of the most marginalized communities in the community. In Los Angeles County, where about 200,000 homes lack internet access, the groups said.
Mojica added that the rollback may prevent providers from reaching the, “highest areas of need.”
The $1.5 billion the state allocated in January for the middle-mile project will be reduced under the updated budget plan, which was unveiled on Friday. The project will be a public broadband network for underserved communities.
CNet’s provides a detailed breakdown of the funding cuts on broadband:
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Newsom’s new budget plan will cut $1.5 billion from the state’s Middle-Mile Broadband Initiative, a $5 billion project signed into law in 2021 that aims to install more than 10,000 miles of fiber-optic cable to areas that have little or no high-speed internet coverage. This would make it more attractive for internet providers to connect in rural, tribal and minority urban communities, where they’ve often been hesitant to build infrastructure to themselves.
Additionally, the changes proposed Friday would eliminate all but $50 million of the state's "Loan Loss Reserve Fund," a credit program that enables organizations to obtain better terms and rates on loans. Additionally, it would push back funding for "last-mile" internet infrastructure investments until the 2027–2028 budget year.
The budget reduction represents one of the steepest funding cuts in recent memory as the state grapples with a $56 billion deficit.
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