Cruz Wants BEAD on Hold, Planning ‘Substantial Changes’

WASHINGTON, Nov. 22, 2024 – Senator Ted Cruz wants the agency managing the $42.5 billion Broadband Equity, Access, and Deployment program to put the effort on hold, saying “substantial changes” to BEAD were on the way in the incoming Trump administration.

Cruz, R-Texas, set to be chair of the Senate Commerce Committee, said he planned once assuming that position to “review” aspects the broadband expansion program that have drawn Republicans' ire, from its fiber preference and low-cost plan requirement to climate resiliency policies.

“It is incumbent on you to bear these upcoming changes in mind during this transition term,” Cruz wrote in a Thursday letter to the National Telecommunications and Information Administration. “I therefore urge the NTIA to pause unlawful, extraneous BEAD activities and avoid locking states into” spending plans.

The NTIA said it had received the letter, and another letter Cruz sent about a separate program, and was reviewing both.

There’s been speculation that the Trump administration might be more inclined to make real changes to the program – which experts say could be time-consuming – now that Elon Musk has become a close advisor of the President-elect. Both men have criticized the program's fiber preference and Musk owns satellite ISP Starlink, which could stand to benefit from less BEAD money going to fiber.

The program prioritizes fiber broadband projects, but allows states to fund other technologies if fiber would be too expensive or providers are unwilling to build to a certain area. Louisiana, for example, said it denied a bid to get fiber to 43 homes and businesses for more than $100,000 per location, opting to go with a mix of fixed wireless and satellite.

Louisiana made those provisional awards under current BEAD rules and is set to submit its plan to the NTIA for final approval in the coming weeks. Four other states have finished taking grant applications and four others are still soliciting project proposals. 

BEAD Director Evan Feinman has downplayed the idea of a shake-up, saying he plans to stick around in the new administration and noting most program requirements are set out in the Infrastructure Act. Industry analysts and some state broadband officers, the ones ultimately awarding money under the program, have said legislative or NTIA-level action is possible.

“Fortunately, as President-elect Trump has already signaled, substantial changes are on the horizon for this program,” Cruz wrote.

Digital Equity Act

Cruz sent a separate letter to the agency asking it to put a different connectivity program on ice.

The NTIA is managing $2.75 billion in digital equity funding, aimed at addressing gaps in broadband adoption that remain after infrastructure is deployed. Also from the Infrastructure Act, it’s an umbrella of sister programs to BEAD, which is aimed at mapping and funding broadband deployment to every unconnected home and business in the country.

Cruz asked the agency to axe a $1.25 billion subset of that funding called the Digital Equity Capacity Grant Program. He said the program engaged in “impermissible race-based discrimination” by funding efforts to get racial minorities, among other groups, online.

The NTIA hasn’t awarded competitive grant funding yet, but it has awarded more than $150 million from a separate digital equity program set aside for state and territory governments. That money can also be used for digital equity efforts in minority communities.

Advocacy groups pushed back on Cruz’s claims that the competitive digital equity program was illegal, noting the Infrastructure Act called for addressing broadband adoption gaps among various populations, including racial minorities.

“The Bipartisan Infrastructure Law created the Digital Equity Competitive Grant Program and required that such grants be made to address the needs of certain ‘covered populations,’ which, in addition to racial and ethnic minorities, include, among others, veterans, aging and disabled individuals, and those who live in rural areas,” Affordable Broadband Campaign spokesperson Gigi Sohn said in a statement. “But Senator Cruz conveniently ignores all but the first in an effort to turn this bipartisan program into some kind of a left-wing DEI agenda.”