RDOF Default Leaves Some Rural Areas Without BEAD Path
South Central Connect walks away from 13 census block groups.
Jan. 5, 2026 – An Arkansas electric cooperative has defaulted on part of its $20 million Rural Digital Opportunity Fund award.
South Central Connect notified the Federal Communications Commission Wednesday it will relinquish 13 census block groups authorized for RDOF support across Arkansas’ Garland, Montgomery and Nevada counties.
The defaults will leave some rural locations without access to funding under both RDOF and the federal Broadband Equity, Access and Deployment program, and add SCC to a growing list of Internet service providers who have defaulted on thousands of RDOF locations.
The subsidiary of South Central Arkansas Electric Cooperative cited rising construction costs as the reason. “Escalating construction costs have led South Central Connect to make this difficult decision,” Todd Lantor, counsel to SCC, wrote to the FCC.
A growing wave of withdrawals have reshaped the $9.2 billion RDOF program since awards were announced in 2020. More than $3 billion in RDOF support has been defaulted on, with providers frequently citing rising construction costs as reason for abandoning awards.
Though it is uncertain what penalties the company might face, the FCC has made known its intention to hold defaulting program participants accountable.
In August, the FCC rejected Mercury Broadband’s request to waive more than $25 million in penalties tied to tens of thousands of defaulted locations, with the Wireline Competition Bureau writing that bidders “knew what to expect” if they later failed to meet their obligations.
Large scale exits have also hit the program. Lumen Technologies fully withdrew from RDOF last summer, surrendering more than 77,000 locations across 20 states after previously defaulting on thousands of others.
In prior cases, providers that notified the FCC of defaults by June 6, 2025 were able to preserve BEAD eligibility for the relinquished locations under the program’s restructuring guidance.
Hundreds of locations defaulted, however, missed that deadline and were subsequently flagged as ineligible for BEAD. The result is a growing set of rural locations that no longer have RDOF support but also fall outside BEAD eligibility.
Based in Arkadelphia, Arkansas, South Central Connect had initially been awarded RDOF support to deploy 1 Gigabit per second * 500 Megabit per second broadband service to 8,015 locations across 48 census block groups in the state.
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