Infrastructure Investment and Jobs Act – Broadband

Points of Contact:

Jonathan Mantz, Commerce Practice Co-Headjmantz@bgrdc.com

Justin Rzepka, Commerce Practice Co-Headjrzepka@bgrdc.com

Robin Colwell, Senior Vice Presidentrcolwell@bgrdc.com

 

Broadband

Topline Funding: $65 billion

Funds grants to states for broadband deployment and other efforts to address access issues in rural areas and low-income communities. The centerpiece is $42 billion allocated for the Broadband Equity, Access, and Deployment Program, a formula-based grant program to states to speed broadband deployment, with 10 percent set-aside for unserved high-cost areas. Each state would receive at least $100M for broadband implementation. Includes $2B towards tribal grants to support access for Native Americans, Alaska Natives, and Native Hawaiians. Expands eligible private activity bond projects to allow states to finance qualified broadband infrastructure. Implementation will be administered through the Department of Commerce.

Federal Costshare: An eligible entity will provide, or require a subgrantee to provide, a contribution, derived from non-Federal funds (or funds from a Federal regional commission or authority), except in high-cost areas or as otherwise provided, of at least 25 percent of project costs. 

 

PROGRAMS & FUNDING STREAMS

BROADBAND EQUITY, ACCESS AND DEPLOYMENT PROGRAM

Authorizes $42.45 billion to the Broadband Equity, Access and Deployment Program, which will make grants to states. Each state will receive a minimum of $100 million. The remainder will be allocated to States based on a formula that takes into account the number of unserved locations in the eligible grantee state as compared with the total number of unserved locations in the U.S. overall. Grants require a 25% local match derived from non-federal funds. Private investment ought to qualify for local match. 

Agency of Jurisdiction: U.S. Department of Commerce – National Telecommunications and Information Administration (NTIA) – https://broadbandusa.ntia.doc.gov/ 

Eligible Grantees: States are the principal grantees. If a state fails to apply for funding, a local government could apply on their behalf. Subgrantees – which can include any entity from a private provider to an electric cooperative – under this program will construct and deploy infrastructure for the provision of broadband services.

Timing: NTIA has 180 days from the enactment of the Act to issue a Notice of Funding Opportunity (“NOFO”) directed to the states. Several layers of state submissions and NTIA processing will follow before funding will be made available to subgrantees, including submission and evaluation of State five-year plans. The process is also dependent on broadband DATA maps being published. Expect funding to begin to flow in 2023.

Notes: The main point of reference over the next year or so for prospective applicants/subgrantees will be upon the policy decisions and rules established by their particular state rather than the federal government. Under the Act, a State is required to solicit input from eligible entities – including local governments, cooperatives, utilities, partnerships, etc. – as it develops its five-year plan and subgrant program. States must also provide to NTIA a “description of coordination with local governments, along with local and regional broadband planning processes.”

 

MIDDLE MILE COMPETITIVE GRANT PROGRAM

Authorizes $1 billion over 5 years for Middle Mile Competitive Grants. In awarding the grants, the intention of the program is to give priority to projects that leverage existing rights-of-way, assets and infrastructure to minimize financial, regulatory and permitting challenges, projects that design the route of middle mile infrastructure to enable the connection of unserved anchor institutions, and projects that facilitate the development of carrier-neutral interconnection facilities, among others. This grant cannot exceed 70% of the total project cost.

Agency of Jurisdiction: U.S. Department of Commerce – NTIA – https://broadbandusa.ntia.doc.gov/ 

Eligible Grantees: States, political subdivisions of a state, Tribal governments, technology companies, electric utilities, utility cooperatives, public utility districts, telecommunications companies, telecommunications cooperatives, nonprofit foundations, nonprofit corporations, nonprofit institutions, nonprofit associations, regional planning counsels, Native entities, and economic development authorities (or partnerships of two or more these entities). 

Timing: NTIA has 6 months to issue a notice of funding opportunity about the new program. Within 9 months after that notice is issued, NTIA will make the grant awards. Awardees must complete their middle-mile construction within five years of winning a grant. NTIA may extend the buildout deadline by no more than a year if the project is underway or if there are extenuating circumstances.

 

DIGITAL EQUITY GRANT PROGRAM

Authorizes $2.75 billion over five years. There are two programs under the Digital Equity Act of 2021 – “State Digital Equity Capacity Grant Program” and “Digital Equity Competitive Grant Program,” both of which are focused on digital inclusion, i.e., the activities that are necessary to ensure that all individuals in the U.S. have access to and the use of affordable information and communication technologies such as reliable, fixed and wireless broadband internet service, internet-enabled devices and applications and online content, and includes digital literacy training and provision of tech support. The U.S. Department of Commerce – NTIA will administer this grant program.

State Digital Equity Capacity Grant Program

Authorizes $60 million in FY22 for planning grants. To be eligible for a grant, a state must submit an application to NTIA no later than 60 days after NTIA has published a notice of funding availability. Each state’s governor will select an administering entity to serve as the recipient and administrator of the grant as well as be responsible to develop, implement, and oversee the State Digital Equity Plan. 

  • Eligible Grantees: States are the principal grantees.
  • Timing: Beginning no later than two years after NTIA begins awarding planning grants, the agency is required to award corresponding capacity grants ($1.44 billion – $240 million in FY22; $300 million each year for FY23-26) to support implementation of State Digital Equity Plans. States will have five years to spend grant awards.

 

Digital Equity Competitive Grant Program

Authorizes $1.25 billion to be allocated in $250 million increments across FY22-26. Purpose of the program is to support efforts to achieve digital equity, promote digital inclusion activities, and spur greater adoption of broadband among covered populations. 

  • Eligible Grantees: A political subdivision, an agency, an instrumentality of the state, including an agency responsible for administering adult education and literacy activities; an Indian Tribe; a foundation, corporation, institution, association, or coalition if they are a not-for-profit providing services in the state—but not a school; a community anchor institution (a public or multi-family housing authority, a library, a medical or healthcare provider, a community college or other institution of higher education, a state library agency, and any other nonprofit or governmental community support organization) located in the state; a local educational agency (i.e. public board of education); an entity located in the state that carries out a workforce development program; or a partnership of eligible entities. 
  • Timing: See Above
  • Notes: No more than 10% of a grant can be used for administration. The Federal share of any project cannot exceed 90%. Awardees will submit evaluation reports to NTIA no later than 15 months after the award is granted and annually in years using program funds. Grants are to be used for no more than four years.

 

AFFORDABLE CONNECTIVITY FUND

The bill extends and modifies the Emergency Broadband Benefit program that was adopted as a COVID-19 relief measure. The program will be renamed as “Affordable Connectivity Fund” and $14.2 billion will remain available until expended for the program. Broadband providers will receive up to $30/month (the Emergency Broadband Benefit is currently $50/month) for providing service to low-income households. The FCC will also give a broadband provider up to $100 if a household purchases one of the provider’s connected devices (laptop, desktop, or tablet computer) for no less than $10 and no more than $50. 

Agency of Jurisdiction: Federal Communications Commission (FCC) – https://www.fcc.gov/broadbandbenefit 

Eligible Grantees: Qualifying households (criteria includes anyone who participates in the FCC’s Lifeline program; a household’s income is at or below 200% of the Federal Poverty Guidelines; at least one person in the household receives benefits from a qualifying federal assistance program; at least one person in the household has received a Federal Pell Grant in the current award year, etc.).

Timing: Ongoing