NTIA Responds to Study Suggesting BEAD Flaw Could Lose Billions to Small ISPs

WASHINGTON, March 9, 2026 – The National Telecommunications and Information Administration (NTIA) responded to a report that claimed to spot a major structural flaw in the Broadband Equity, Access, and Deployment (BEAD) program — a flaw that could cost billions. 

A report published by the Advanced Communications Law and Policy Institute (ACLP) at New York Law School said under rules set in June by Commerce Secretary Howard Lutnick, 24 small internet service providers were chosen to receive a combined $2.5 billion to provide broadband to consumers. ACLP project authors Alex Karras and Michael Santorelli said these ISPs’ BEAD commitments will more than double the number of locations they currently serve. 

In response, the NTIA said it has reviewed the ISPs as part of BEAD, reduced permitting obstacles and made it clear that relying on future subsidies for broadband buildout was not allowed. 

“NTIA conducted vigorous oversight of BEAD awardees in an effort to keep defaults to an absolute minimum, including enforcing matching requirements, rejecting projects with excessive costs, and removing federal and state regulatory uncertainty,” an NTIA spokesperson said in a statement. 

In the initial ACLP report, Karras and Santorelli pointed to IBT Connect as one example. IBT Connect currently serves four locations, three of which are multi-unit structures, totaling its customers at approximately 727. With BEAD, IBT Connect was picked to receive more than $110 million to connect 44,906 locations in nine new states. 

The study concludes that some ISPs would more than double or triple its current service to customers and signal the ISP could potentially not handle the job.

“We’re just observing that some ISPs are set to greatly expand their service territories, far more than others, and that for the ISPs that are only expanding incrementally, they might be better positioned to do so given their existing scale and track record, while those that are seeking to more than double their footprints might find it challenging given their current size,” Santorelli said.