Commerce Department’s NTIA Releases Details for Funds Distributed Under IIJA

WASHINGTON, May 13, 2022 – The U.S. Commerce Department on Friday morning released the rules governing three separate federal broadband programs, laying down the rules for more than $45 billion in spending.

The agency’s National Telecommunications and Information Administration released the Notice of Funds Opportunity for its Broadband Equity, Access and Deployment program under the Infrastructure Investment and Jobs Act, as expected.

“In the 21st century, you simply cannot participate in the economy if you don’t have access to reliable, affordable high-speed internet,” Commerce Secretary Gina Raimondo said on Monday. She was expected to make additional remarks in Durham, North Carolina.

“Thanks to President Biden’s Bipartisan Infrastructure Law, Americans across the country will no longer be held back by a lack of high-speed internet access. We are going to ensure every American will have access to technologies that allow them to attend class, start a small business, visit with their doctor, and participate in the modern economy,” according to Raimondo’s remarks from a press release.

The IIJA, signed into law on November 15, 2021, required Commerce to release the BEAD NOFO by Monday, May 16. It had been expected to release those rules Friday.

Funding under the BEAD program is primarily directed through state broadband offices, acting under the supervision of the NTIA through the legislative framework established by IIJA, and the regularly rules laid out in the BEAD NOFO.

Want to know more about this game-changing document, and the powerful tools it brings to U.S. last mile broadband? Visit Broadband.Money‘s tools and resources, including four themes to watch for in the BEAD NOFO.

Amounts of funding and general framework

But the agency also released the rules for the Enabling Middle Mile Broadband Infrastructure and State Digital Equity Act programs on Friday, in advance of when IIJA required the notices.

• Broadband Equity, Access, and Deployment (BEAD) Program ($42.5 billion)
• Enabling Middle Mile Broadband Infrastructure Program ($1 billion)
• State Digital Equity Act programs ($1.5 billion)

The IIJA allocated $65 billion in funding for broadband spending, with at least $45 billion allocated to the NTIA through these three programs. The $42.5 billion for BEAD is designed to address last-mile broadband connectivity. The $1 billion for middle mile spending addresses the “secondary highways” — in between data centers and individual homes — that allow our internet to work. The additional $1.5 billion is for states to engage in programs designed to address digital equity.

Most of the additional $20 billion of broadband funds under IIJA are dispensed through the Federal Communications Commission’s Affordable Connectivity Program.

But BEAD itself also include money for planning grants: Under IIJA, each state is guaranteed to receive $100 million in BEAD funds for broadband infrastructure. Up to $5 million of those awards may be drawn down within three months.

Each state is able to receive at least $100 million in funding. Particular states may receive significantly more depending upon the proportion of “unserved” broadband homes in their state relative to the nation as a whole. Whether a particular home is “unserved” or not will be determined by broadband maps to be created by the FCC.

The funding is being dispensed by states to sub-grantees, including private, cooperative and municipal broadband providers, and the BEAD funding is designed primarily to address inadequate last-mile broadband connectivity throughout the country.

To participate in the BEAD Program, states and other eligible entities must submit a letter of intent and a planning funds budget. Each state will have support from NTIA staff.

The Enabling Middle Mile Broadband Infrastructure Program will award grants on a competitive basis to eligible entities for the construction, improvement, or acquisition of middle-mile infrastructure.

Friday’s launch of the State Digital Equity Planning Grant Program kicks off a series of Digital Equity Act steps that will invest $1.5 billion to heighten adoption and use, like digital literacy training, for those who need it most, including communities of color, rural communities, and older Americans.

New web site from the Commerce Department’s NTIA

In addition to program’s kickoff by Raimando, the NTIA launched a new web site, Internet for All, as well as an Internet for All Fact Sheet, with links to all three broadband programs.

The agency also released a series of webinars for every day next week. And the week after next, this writer will have the the opportunity to sit and and interview NTIA Administrator Alan Davidson at Mountain Connect on Tuesday, May 24.

“The resources in President Biden’s Bipartisan Infrastructure Law will allow us to bring broadband infrastructure to every corner of our country, make service affordable for everyone, and ensure users have the devices and digital skills they need,” said Deputy Secretary of Commerce Don Graves.

“Generations before us brought electricity to rural America and built the interstate highways,” said Davidson, who is also Assistant Secretary of Commerce for Communications and Information. “Our generation’s task is to connect all Americans online.”

NTIA gives preference to fiber

The 98-page Notice of Funding Opportunity provides answers to many of the questions for which the NTIA sought comment in January and February. Local coordination emerges as a strong theme in the BEAD NOFO.

In the NOFO, the NTIA provides a clear preference on some important questions, including fiber versus other technologies, addressing the underserved as well as the unserved, and ensuring no bar on municipal broadband.

“With respect to the deployment of last-mile broadband infrastructure, the Program prioritizes projects designed to provide fiber connectivity directly to the end user,” the NTIA’s NOFO reads on page 7.

The requirement also highlights how important it is that projects “provide a low-cost option to eligible subscribers” and that state awardees “have plans to address middle-class affordability.” (Also on page 7.)

Later, the NTIA emphasizes that to meet the threshold for being a “Priority Broadband Project,” a project must “provision service via end-to-end fiber-optic facilities to each end-user premises.” (Page 14.) In a footnote, the agency further notes that “a project that will rely entirely on fiber-optic technology to each end-user premises will ensure that the network built by the project can easily scale speeds over time to meet the evolving connectivity needs of households and businesses and support the deployment of 5G, successor wireless technologies, and other advanced services.”

The underserved are not slighted

Additionally, the NTIA is not unduly emphasizing the “underserved” part of the broadband marketplace.

IIJA established the definition of “unserved” as a location not capable of receiving broadband internet access at 25 Megabits per second (Mbps) download and 3 Mbps upload, which is the FCC’s current definition of broadband.

IIJA established a second definition of “underserved” as a location not capable of receiving broadband at 100 Mbps x 20 Mbps.

This means that a broadband project aiming to address the “underserved” as well as the “unserved” may require more robust broadband investment.

“The [BEAD] Program’s principal focus will be on deploying broadband service to unserved locations and underserved locations,” the NTIA writes on page 7 (emphasis in original).

“Eligible Entities that demonstrate they will be able to ensure service to all unserved and underserved locations will be free to propose plans that use remaining funds in a wide variety of ways, but NTIA underscores its strong preference that Eligible Entities also ensure deployment of gigabit connections to community anchor institutions such as libraries and community centers that lack such connectivity.”

This language, and the inclusion of “unserved” and “underserved” in the same phrase, strongly suggest that the NTIA is seeking to nudge states toward the more ambitious goal of ensuring that all Americans have access to 100 x 20 Mbps broadband.

Municipal broadband gets a warm embrace

Also noting that IIJA specifically requires that BEAD funds be available for private, cooperative and non-profit broadband providers, NTIA is firmly nudging states to eliminate or relax existing laws against municipal broadband.

On page 50 and 51, the NTIA writes:

• Competition among broadband providers has the potential to offer consumers more affordable, high-quality options for broadband service. As required by the Infrastructure Act, in awarding subgrants for the deployment of a broadband network using grant funds, Eligible Entities may not exclude cooperatives, nonprofit organizations, public-private partnerships, private companies, public or private utilities, public utility districts, or local governments (“potential providers”) from eligibility for grant funds. In determining whether to approve an Eligible Entity’s Initial or Final Proposal, NTIA will consider whether the Eligible Entity has, after the enactment of the Infrastructure Act, adopted new laws, regulations, policies, procedures or any other form of rule or restriction that, in the determination of NTIA, seeks to exclude or has the effect of excluding any potential providers from eligibility for its subgrant competition. This could include new laws that have the effect of excluding providers from offering broadband service or rendering them incapable of effectively competing for subgrants.
• Some laws of Eligible Entities concerning broadband, utility services, or similar subjects that predate the enactment of the Infrastructure Act may either preclude certain public sector providers from participation in the subgrant competition or may impose specific requirements on public sector entities, such as limitations on the sources of financing, the required imputation of costs not actually incurred by the public sector entity, or restrictions on the service a public sector entity can offer. NTIA strongly encourages Eligible Entities to waive all such laws for purposes of the Program. If an Eligible Entity does not do so, the Eligible Entity must identify all such laws in its Initial Proposal and describe how the laws will be applied in connection with the competition for subgrants. Such Eligible Entity must, in its Final Proposal, disclose each unsuccessful application affected by such laws and describe how those laws impacted the decision to deny the application.

Steps and deadlines

The NOFO kicks off a series of key milestones and grant application deadlines. Letters of intent from states must be received by 11:59 p.m. ET on July 18, 2022. All supplemental information must be submitted by 11:59 p.m. ET on August 15, 2022.

These states must then submit their five-year action plans to NTIA within 270 days of receiving their planning funds. States will be notified of future submission deadlines following the FCC’s release of the maps required by the Broadband Deployment Accuracy and Technology Availability (DATA) Act that was again included in IIJA. The FCC has said these maps will be available this fall.

Following those first three steps (the letter of intent, request for initial planning funds, and the five-year action plan), additional steps in the IIJA BEAD process include: (4) Program Fund Allocation and the Notice of Available Amounts, (5) the Initial Proposal, (6) the Challenge Process, (7) the Subgrantee Selection Process, (8) the 20 Percent Funding Release, and (9) the Final Proposal and Release of Remaining Funds.

Among the Commerce Department’s talking points include:

• Connect All Americans to High-Speed Internet. For far too long, too many Americans have been left out or left behind because they don’t have access to reliable, affordable high-speed internet.
• Close the Digital Divide. Beyond lacking access, many people in communities across the nation can’t afford Internet service, or they don’t have the skills necessary to effectively use the Internet or a connected device.
• Make the Internet More Affordable. Internet access is essential to participate in today’s economy. For far too long, too many Americans have been left out or left behind because they don’t have access to reliable, affordable high-speed Internet.
• Ensure that Children have Access to the Education they Deserve. During the pandemic, parents and children were asked to work and learn alongside one another at home – but far too many homes didn’t have internet access at the speeds and cost necessary to participate.
• Expand Telehealth and Connect Vital Public Safety Services. For Americans who live in communities with slow or unreliable Internet connections, the COVID-19 pandemic posed an extraordinary challenge. Communities with limited or no access were left out and left behind without access to life-changing or life-saving technologies for education and telehealth.
• Create Good-Paying American Jobs. A highly trained, diverse workforce that can safely do their jobs will be essential to connecting everyone in America to high-speed internet. The Internet for All programs will create thousands of good-paying jobs, and NTIA will work with states, territories, and other partners to ensure that those jobs are accessible to a workforce that looks like America.