8 Feb 2024

Broadband for All — Let’s Not “Throw Away Our Shot!”

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Part 1 – Why the Next Few Months Are Critical

“I am not throwin’ away my shot!” This line, from the musical Hamilton keeps playing in my head as I think about our “once in a generation” opportunity to finally provide everyone in our state high speed internet – broadband.

This is the first of several blogs designed to alert and call on Public Organizations to help make universal access to broadband a reality.  This is particularly true now, as $1.7 billion of federal government funding is about to become available through the Broadband Equity Access and Deployment Act (BEAD) program.

“Public Organizations” include local government, such as county commissions, city councils and boards of aldermen, and school district boards; as well as their partners, chambers of commerce; regional economic development planning commissions and regional councils of government; and civic nonprofits, such as Rotary and Lions Clubs.

While most of the money for broadband infrastructure will be directed to private for-profit internet service providers (ISPs), Local Public Organizations can help ISPs create economically sustainable infrastructure and help communities use this new asset to improve the health, education and economic opportunity, for all residents.

Why Now? Haven’t We Closed the Digital Divide?

As the COVID pandemic set in during 2020, skepticism over whether there was a need for broadband quickly gave way to an understanding that, like electricity and running water, a stable high-speed internet connection provided an essential “utility” for businesses and families. This led to a dramatic increase in promised state and federal  government funding for broadband infrastructure. While some of that government funding has been awarded to ISPs much, much more is only now becoming available.

In late 2021, Congress passed the bipartization “Infrastructure Investment and Jobs Act” (IIJA). That Act authorized over $60 billion of federal funding for broadband access, adoption, and affordability programs. $42.5 billions of that amount is dedicated to broadband access through the Broadband Equity Access and Deployment Act (BEAD) grant program. These laws (and others) have been summarized in several blogs already [here], [here] and [here] When combined with continued support provided by the Federal Communications Commission’s (FCC) RDOF Program and the USDA’s Reconnect Program, the federal government’s promised investment in broadband over the next decade  totals more than $100 billion!

So, “problem solved!” you might think, and certainly this federal funding could go a long way toward providing reliable broadband access to all unserved and underserved locations in Missouri and across the United States. Yet, there is still much more to be done. For example, the nearly $200 million awarded by the State of Missouri during the fiscal year ending June 2023, will provide access to only 8% of Missouri locations that need service.

The largest single federal program enacted in 2021 — BEAD — promises Missouri $1.7 billion of grants to provide reliable and affordable broadband service to every unserved location, and potentially every underserved location in Missouri. However after more than two years, only a small fraction of BEAD funding has been distributed to states.

Although slow, progress, is being made. At the end of last year Missouri’s Office of Broadband Development (OBD) submitted its “Initial Proposal” to the National Telecommunication and Information Agency (NTIA) for approval. The Initial Proposal includes OBD’s processes for identifying projects and distributing BEAD funds. OBD hopes to receive approval of the Initial Proposal by February 18th. Assuming this happens, OBD expects to begin accepting requests for grants this summer and possibly award the first grants this fall.

The timeline depends on NTIA’s approval of the Initial Proposal, and certainly, that timing could “slip.” It is also possible that NTIA may modify some of the details of the Missouri proposal, but the fact remains that after years of waiting, the next few weeks and months likely will determine what locations will receive a share of the BEAD money, and what broadband infrastructure technology will be built over the next five years.

In other words, for communities across the state that lack adequate broadband access, now is the time to become engaged in efforts to finally bridge the digital divide.

What to Expect

The state’s Initial Proposal calls for action to commence immediately following NTIA approval. This will involve two preliminary steps – (1) finalize the locations eligible for BEAD funding and (2) prequalify ISPs that will be eligible to participate in the BEAD proposal and funding process. Following the first two steps, OBD will begin accepting specific proposals for the first of at least two funding rounds. Proposals for round one will ideally be accepted between June 1 – July 31, 2024, with the first awards made by October 2024.

The first round of funding will be designed to favor proposals that connect locations using the fastest and most robust broadband infrastructure — fiber optic cable to the premises (FTTP). The second round of funding will target locations not funded in the first round because they are harder to reach and less economically viable. Other forms of reliable infrastructure, such as cable and wireless connections, likely will be used more for this round of funding. Both funding rounds will be numerically scored, and in each case the amount of BEAD grant funds requested will be a very important, but certainly not the only, factor in determining whether a proposal will be funded.

Identify BEAD Eligible Locations

When NTIA approves the Initial Proposal, OBD will publish its proposed set of eligible BEAD funding locations. Generally funding is available for unserved and underserved locations, determined by the download and upload data speeds, with minimum requirements for latency (the time it takes for a signal to be transmitted and received). This eliminates satellite internet providers. In addition, locations served only by DSL are considered “underserved” regardless of the stated connection speed. Finally, locations already awarded funding under most federal and state programs or otherwise subject to a “binding commitment” to provide broadband service within the next 12 months will not be eligible for BEAD funding.

Last month OBD released its preliminary map of unserved and underserved locations in Missouri. This map, based on the FCC’s FABRIC, is the most comprehensive effort yet to accurately identify locations (homes, businesses and institutions) that should have access to broadband service, locations where ISPs claim to be providing service, and finally the advertised speed of the connection at the location. The preliminary map will be modified by OBD, based on criteria set out in its Initial Proposal (as previously described).

ISPs and Public Organizations will then have at least 45 days to “challenge” the status of a particular location or group of locations based on one of several criteria. These challenges can result in locations being found ineligible for BEAD funding or be reclassified as unserved or underserved. While it is hoped that most of the inaccuracies that plagued earlier FCC maps have been corrected, there likely still will be errors, and this makes participation in the process very important to the overall success of the BEAD program.

ISP Prequalification

Experience has taught OBD the importance of carefully vetting ISPs through a prequalification process before allowing them to submit proposals for BEAD funding. The FCC’s Rural Digital Opportunity Fund (RDOF) Program illustrated the folly of failing to adequately vet participants prior to the competitive bidding process. Many months after preliminary grant recipients were publicly announced, the FCC disqualified two of the largest “winners” of the competitive bidding process because they lacked the technology and/or the financial wherewithal to actually complete the promised projects.

To avoid repeating this result, OBD’s Initial Proposal requires ISPs to prequalify before they can participate in the BEAD funding program. Assuming the Initial Proposal is approved as expected, the Prequalification Process for the first round of BEAD funding is expected to begin on April 17 and close by May 31.

The BEAD Award Process

After establishing eligible funding locations and prequalifying ISPs, OBD will proceed to “round one” of the BEAD awards. During the month of April, OBD will amend its maps to create areas that will be eligible for BEAD funding. These areas will be selected by OBD based on factors such as the location of nearby qualified ISPs and the feasibility of connecting unserved and underserved locations to existing networks.

Approved ISPs will then be able to submit proposals for BEAD funding for any one or combination of these areas, but they must agree to serve every location in the area or areas they have selected. Further, in this first funding round only, proposals that offer FTTP for all locations, will be awarded BEAD funds even if other technologies could provide service at a lower cost, so long as the amount of BEAD funds requested does not exceed a maximum BEAD outlay amount established by OBD.

In the case of multiple proposals for a given area, awards will be based on a numeric scoring matrix, that takes many factors into account. However, three of those factors seem likely to be most relevant. First, the amount of BEAD funds requested (the BEAD Outlay) likely will be very important in determining which ISP receives a BEAD grant. The scoring matrix will favor proposals that request a lower BEAD Outlay. Second, while the BEAD Outlay is important, proposals that offer FTTP rather than other alternate technologies and proposals with shorter deployment times will receive more points. Finally, a substantial number of points will be awarded for proposals that have public support, and this is especially true for proposals where Public Organizations are providing some level of financial support.

What is the Strategy for Public Organizations?

This is a multipart blog, and future articles will focus on specific ways Public Organizations can help make the BEAD program a success in their communities. However, it’s clear Public Organizations can take steps now to set the stage. OBD’s preliminary map enables every community to see each home, business and structure that needs a broadband connection and to identify the ISPs that claim to be able to provide service to that location – and the maximum level of service they can provide.

Local Public Organizations are uniquely able to verify that data because they are a part of the local community. This is especially important because individuals cannot challenge the FCC data or OBD’s map directly. This means that Public Organizations will need to play a critical role in developing challenges to the map when that is necessary. Equally important, local Public Organizations can serve a vital role in assessing, and if necessary, rebutting challenges to the map that are raised by ISPs in the area.

In addition, the data in the preliminary map gives Public Organizations a list of the providers serving each location – both in the community and in surrounding areas. In all likelihood, these ISPs will be making the business decision regarding whether they will participate in BEAD funding, and if so, the specific locations where they will extend service, and the type of technology (fiber, cable or fixed wireless) they will use.

These decisions will not be made in a vacuum. Among other considerations, ISPs will assess the ease of obtaining permits, right of way, and easements to construct the improvements, and the level of customer subscriptions they can expect in the new service area. As will become evident in later blogs, Public Organizations can do much to help and encourage ISPs as the grapple with these issues. However, the first step (and perhaps the most important one), is for Public Organizations in the community to reach out to each local ISP to let them know they are interested in participating and assisting them in the process of developing a BEAD proposal.

*** BEAD offers communities across the state an historic opportunity to finally become connected to the internet in ways that will improve the health, education and economic opportunity for everyone. For our state, this truly is “our shot” .. and we must not throw it away.

16 Jan 2024

The Affordable Connectivity Program May “Go Away” Just When it is Needed Most

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They say timing is everything, and that certainly likely will be the case as we move forward this year to implement major components of the 2021 Federal Infrastructure legislation (the Infrastructure Act). You may recall that the Infrastructure Act appropriated $65 billion with the objective of providing every residence, business and institution in the United States a high-speed internet connection – broadband, and the skills to use it. Read more…

16 Jan 2024

The Affordable Connectivity Program May “Go Away” Just When it is Needed Most

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By Marc McCarty

They say timing is everything, and that certainly likely will be the case as we move forward this year to implement major components of the 2021 Federal Infrastructure legislation (the Infrastructure Act). You may recall that the Infrastructure Act appropriated $65 billion with the objective of providing every residence, business and institution in the United States a high-speed internet connection – broadband, and the skills to use it. The Act has three goals: building out the infrastructure needed to connect unserved and underserved locations (broadband “access”), getting individuals the skills-based training and resources they need to use a broadband connection effectively (“adoption”), and finally, making broadband affordable for households that lack the financial resources to subscribe for the broadband connection they need (“affordability”).

The rationale for this “three-prong” approach is logical. It makes little sense to build out a broadband network in unconnected communities if most of the targeted individuals are afraid to go online or lack the skills needed to use the internet applications that would help them the most. These skills, include using the internet to start a business, pay bills and bank online, connect with a health care provider, or get an advanced education certification or degree. Equally obvious, having a fiber optic broadband connection at your home is of no value if you can’t afford to subscribe for service, or if you can’t afford a basic device to connect to the internet efficiently.

With this in mind, an earlier Blog noted that the Infrastructure Act had allocated at least $46 billion of grants and low interest loans for broadband access, up to least $4.75 billion for broadband adoption programs, and $14.2 billion for broadband affordability (the Affordable Connectivity Program or “ACP”).

The ACP was designed to permanently replace the Emergency Broadband Benefit (“ECB”) a similar temporary program enacted during the COVID pandemic. Like the ECB, ACP is targeted to help families that lack financial resources pay for the internet service they need to use the internet effectively. While there are several ways to qualify for ACP, generally families earning less than twice the annual poverty income ($60,000 for a family of 4) are eligible for the ACP.

The ACP provides these households a $30 per month credit that can be applied to monthly cost of internet service and a one-time $100 credit toward the cost of a desktop, laptop or tablet computer to connect to the internet. The program began funding in 2022 and as of last week, over 22.5 million households were receiving benefits. One advantage of the ACP is that the “credit” can be applied by families toward any level of broadband service offered, so even if a household was able to pay for some internet connectivity before, the ACP enabled them to upgrade to a higher more expensive level of service, so they can take advantage of applications such as telemedicine and online learning that require a faster and more stable internet connection.

Many Missouri families now use this benefit. In several rural Missouri counties more than one in five households that are connected to the internet are receiving ACP. The truth is ACP has been so successful, that it is about to run out of money. The FCC administers this program, and it has already instructed internet service providers (“ISPs”) to send out the first of three written notices beginning January 25, to customers warning them the benefit will expire (likely sometime in May).

The ACP has wide support among participants, internet providers and the general public. Last week bipartisan legislation was introduced to extend funding for the ACP through the end of 2024. Certainly given the political environment, that may be the best we can do at this time, and even in this case passage of this legislation likely will not occur unless constituents make their wishes known.

Ironically, this comes at the very time when almost all the Infrastructure Act money set aside for broadband access (BEAD) and broadband adoption (DEA) remains unspent! The delay in funding BEAD and DEA occurred for many reasons, some of which I’ve written about already. However, Missouri’s Office of Broadband Development (OBD) now awaits approval of its “Initial Proposal” to distribute the first 20% of the $1.7 Billion dollars of BEAD funding along with a smaller DEA “State Capacity Grant” to fund broadband adoption. Those approvals (granted by the National Telecommunications and Information Agency –NTIA) are expected as early as late spring, followed by competitive grants that could begin funding new projects by year-end.

For a variety of reasons, the State’s BEAD proposal primarily contemplates using existing private and public ISPs to extend broadband service to the 400,000 locations in the state with no – or with inadequate – broadband access. Those ISPs provide access to the internet (fund capital expansion, maintain, and operate) primarily through subscriber revenues paid by businesses and residents. Locations needing broadband access lack it in most cases because the ISPs that potentially could serve them cannot make an adequate profit to justify the investment. The objective of the BEAD program is to use just enough public money to induce ISPs to expand service to these unserved and underserved locations.

For example, if the average cost of extending service to a group of locations was $5,000 per location, but an ISP could only be profitable if installation costs were no more than $1,500 per location, an efficient BEAD grant program would provide the ISP a grant of $3,500 per location, conditioned on the ISP going forward to provide broadband access to all of these unserved locations. But that example assumes that families and businesses in those locations actually will subscribe for the service (at levels as high as – or higher— than other areas where service is currently available). In other words – ISPs don’t need or necessarily want more locations with access to the internet – instead they want more locations with internet subscribers.

That is one practical reason why both the DEA, and the ACP exist. From a purely economic standpoint, both of these programs are designed to work alongside BEAD to increase demand for broadband service (the “take rate” as it’s known in the industry). The DEA gives folks the skills needed to appreciate and safely use internet based applications and technologies; the ACP makes that service affordable, so families to pay for the service they need.

Taken together one can think of these broadband programs BEAD, the DEA and the ACP as something like a three legged stool. The three legs of that stool provide funding for broadband access, adoption and affordability. Remove one of those legs, affordability in this case, and the stool – a $65 billion stool – may well topple over.

Of course there are many good reasons for providing financial assistance to families that can’t afford the broadband service they need besides creating a broadband network that is financially viable. Connecting most businesses and individuals to broadband has led to extraordinary gains in productivity and quality of life, but as the COVID pandemic illustrated, those gains have been uneven, with millions lacking adequate internet service and unable to use these new internet-based applications. We all pay when we leave the most economically vulnerable families disconnected to the internet applications we take for granted, in higher costs for healthcare, basic government services, substandard education, and fewer economic opportunities. A program like the ACP can help remove financial barriers to internet connectivity, and certainly it can be justified for that reason alone. However, allowing a program like the ACP to go away after all the work done over the past two years, and just as we are ready to spend over $45 billion on broadband expansion, is most certainly a mistake.

21 Dec 2023

States are About to Dole Out Federal Funding. Not All Are Ready

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This story was originally published by The Conversation.

When the Infrastructure Investment and Jobs Act was signed in late 2021, it included $42.5 billion for broadband internet access as part of the Broadband Equity, Access, and Deployment Program. The program aims to ensure that broadband access is available throughout the country. This effort differs from previous federal broadband programs because it promised to allocate the funding to individual states and allow them to figure out the best way to distribute it. Read more…

29 Jun 2023

Fact Sheet: Biden-⁠Harris Administration Announces Over $40 Billion to Connect Everyone in America to Affordable, Reliable, High-Speed Internet

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Largest Internet Funding Announcement in History Kicks Off Administration-Wide Investing in America Tour

High-speed internet is no longer a luxury – it is necessary for Americans to do their jobs, to participate equally in school, access health care, and to stay connected with family and friends. Yet, more than 8.5 million households and small businesses are in areas where there is no high-speed internet infrastructure, and millions more struggle with limited or unreliable internet options. Just like Franklin Delano Roosevelt’s Rural Electrification Act brought electricity to nearly every home and farm in America, President Biden and Vice President Harris are delivering on their historic commitment to connect everyone in America to reliable, affordable high-speed internet by the end of the decade.

Today, the Department of Commerce announced funding for each state, territory and the District of Columbia for high-speed internet infrastructure deployment through the Broadband Equity Access and Deployment (BEAD) program—a $42.45 billion grant program created in the Bipartisan Infrastructure Law and administered by the Department of Commerce. This announcement—the largest internet funding announcement in history—kicks off the three-week Administration-wide Investing in America tour, where President Biden, Vice President Harris, First Lady Jill Biden, Cabinet members, and Senior Administration Officials will fan out across the country to highlight investments, jobs, and projects made possible by President Biden’s economic agenda.

Among the highlights:

  • Awards range from $27 million to over $3.3 Billion, with every state receiving a minimum of $107 million.
  • 19 states received allocations over $1 billion with the top 10 allocations in Alabama, California, Georgia, Louisiana, Michigan, Missouri, North Carolina, Texas, Virginia and Washington.
  • With these allocations and other Biden administration investments, all 50 states, DC, and the territories now have the resources to connect every resident and small business to reliable, affordable high-speed internet by 2030.

Details related to the BEAD allocation for the states, D.C., and territories, as well as the total Federal investment in high-speed internet in each State and Territory are available here.

In addition to helping connect everyone in America to high-speed internet, this funding will support manufacturing jobs and crowd in private sector investment by using materials Made in America.  For example, anticipating this major investment in high-speed internet infrastructure deployment, earlier this year, fiber optic cable manufacturers CommScope and Corning announced $47 million and $500 million expansions of their domestic manufacturing capacity, which will create hundreds of good-paying American jobs in North Carolina. These investments are part of the nearly $500 billion in private sector manufacturing and clean energy investments spurred by the President’s Investing in America agenda. The Investing in America agenda represents the most significant upgrade to our nation’s infrastructure in generations—an investment larger than FDR’s Rural Electrification effort, Eisenhower’s effort to build the Interstate Highway system, and the construction of the Panama Canal.

Internet for All

Today’s announcement of BEAD funds is just one component of the Biden-Harris Administration’s efforts to ensure that everyone in America has access to affordable, reliable high-speed internet as part of President Biden’s Investing in America agenda.  In recent weeks, the Administration has announced over $700 million in USDA ReConnect awards, over $900 million in NTIA Middle Mile awards and launched the Online for All campaign to increase ACP enrollment and visibility.   Beyond BEAD, billions have already been announced or distributed to all states and territories to build out high-speed internet infrastructure by the Biden-Harris Administration.

In addition to BEAD, the Bipartisan Infrastructure Law includes:

  • $14.2 billion for the Affordable Connectivity Program (ACP), which provides eligible households up to $30/month (up to $75/month on qualifying Tribal Lands) off their internet bill, as well as a one-time $100 toward a desktop, laptop or tablet computer offered by participating internet service providers. Thanks to commitments by over 20 internet service providers, millions of Americans are using the Affordable Connectivity Program to access internet for free. Today, 19 million Americans are enrolled in this program. Households can check their eligibility and sign up at GetInternet.gov.
  • $2.75 billion for the Digital Equity Act, which provides grants to ensure communities have the skills and support needed to take advantage of high-speed internet connections;
  • An additional $2 billion for the Tribal Broadband Connectivity Program, which provides grants to federally recognized Tribal governments, Tribal organizations, Tribal Colleges and Universities, the Department of Hawaiian Homelands, and Alaska Native Corporations for high-speed internet deployment on Tribal lands, as well as for telehealth, distance learning, high-speed internet affordability, and digital inclusion;  
  • $2 billion for the Department of Agriculture’s (USDA) Reconnect Program, which provides loans and grants primarily to build high-speed internet infrastructure in eligible rural areas;  
  • $1 billion for the Middle Mile Program, which provides funding for the “middle mile” backbone of internet networks.

President Biden’s American Rescue Plan also included over $25 billion for high-speed internet, including:

  • The Department of Treasury’s Capital Projects Fund (CPF) provides $10 billion to states, territories, and Tribes for which high-speed internet is an eligible use. Today, over $7 billion has already been dedicated to high-speed internet deployment and connectivity across 45 states;
  • The Coronavirus State and Local Fiscal Recovery Funds (SLFRF) delivered funding across the country to support the response to and recovery from the COVID-19 pandemic. About $8 billion is being used by states, territories, Tribes, and local governments for high-speed internet deployment and connectivity; and,
  • The Federal Communications Commission’s (FCC) $7 billion Emergency Connectivity Fund program helped schools and libraries close the “homework gap,” providing schools and libraries with 10.5 million connected devices and over 5 million internet connections.

Additional information on Biden-Harris high-speed internet programs and funding is available at InternetForAll.Gov. 

14 Jun 2023

Thank you, broadband coverage map challengers! 

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This is a great big ‘thank you” to MU Extension staff and faculty in 34 counties who helped 186 people submit challenges to the Federal Communications Commission broadband coverage maps.

The maps will be used to calculate Missouri’s share of $42.45 billion in federal funds to expand access and use in every community. Their accuracy is vital.

The state Office of Broadband Development estimates the additional dollar value from those 186 challenges alone at $810,000, said Alison Copeland, UM System deputy chief engagement officer.

A special shout-out goes to Knox, Cole, Cape Girardeau, Gentry, Johnson, Hickory, Vernon and Ste. Francois counties for organizing challenge events. The UM System Broadband Initiative and state Office of Broadband Development also appreciated that several counties flagged issues with the process and maps, Copeland said. This online tool aims to offer a comprehensive statewide inventory of public computers and Wi-Fi access locations as well as digital resources such as computer classes, one-on-one technical assistance centers and adult/workforce education programs. Please share this information in your communities, too!