Resources

6th Nov 2024 0

BEAD Funding, everything we currently know 

 The Broadband Equity, Access, and Deployment (BEAD) Program has been an impressive display of federal encouragement to enhance the welfare and economic growth of individual states across the country. This funding originated from the Infrastructure Investment and Jobs Act (IIJA) which was brought into law by President Biden in 2021. This act allocated a total of $42.5 billion to the BEAD fund to connect all Americans to reliable broadband.  

The BEAD initiative on the whole is primarily focused on expanding high-speed internet across the US, with the main objective being to bridge the digital divide, enhance connectivity, and promote digital equity. Although that doesn’t necessarily mean fiber networks, with a target on all 50 states, this allows for plenty of room for fiber deployments.  

How was funding allocated? 

Deadlines to apply for BEAD funding are now long closed, with states being required to submit their initial proposals to the National Telecommunications and Information Administration (NTIA) by December 01, 2023. Should decisions be challenged based on the initial submission, states had to raise their challenge before the August 6th deadline. Although states can no longer challenge their decision, they were given an additional 365 days for the submission of final proposals after the first deadline in 2023 – leaving only 1 month left for states to submit these final proposals. Once these are approved, each jurisdiction will be able to access their BEAD funding to start their projects. Although complicated, the BEAD funding process has been designed in this manner to ensure that funds are allocated and used efficiently to expand high-speed internet access across the country, with little room for funding wastage. 

When it comes to the assessment of each application, each state received a baseline allocation of $100 million. The remaining funds from the total $42.2 billion are being distributed based on ratios of unserved and high-cost locations within each state. The program prioritized funding for unserved locations above those underserved – no connection vs poor connection. There has also been consideration of the rural expanse of each state. Those with larger rural populations such as Alaska and Wyoming are receiving more funding per resident due to inevitably higher deployment costs. 

Once states have their total funding allowance approved, they are individually responsible for distributing the funds to eligible sub-grantees, including cooperatives, non-profits, private companies, and local governments. It is worth noting that while states have control over their own funds, they must comply with federal rules which are being monitored by NTIA. Their process for selecting their sub-grantees will have been included in their initial proposals and will have been approved. 

When are the funds released? 

Following the approval of initial proposals, states received 20% of their funding to commence preliminary work. After the approval of final proposals – which must be submitted by December 01, 2024 – the remaining funds will be released.  

The actual distribution of funds to sub-grantees will however the respective competitive selection process for sub-grantees is completed. Whilst we can hope as service providers that this process will be fast, we cannot guarantee how long each state will take throughout this process. It must also be considered that the construction of networks across the country is proposing a resourcing issue, which may encourage some states to wait until resources are more readily available, at lower cost – This, however, is speculative. 

Due to the full process requiring lots of different factors being completed concurrently, rather than consecutively, there are suspicions that sub-grantee funds may not start being spent until late 2025 at the earliest. NTIA is saying it is working as fast as it can, so this timeline cannot be changed. 

Challenges arising for each state 

With each state and jurisdiction essentially managing their own project and funding alone, there are a substantial number of challenges they face. Some of these are:

– Complexity of mapping and data collection

Accurate Mapping: Creating accurate maps to identify unserved and underserved areas is a significant challenge. For example, Rhode Island faced legal issues when Cox Communications sued over the state’s use of speed tests to identify underserved areas. Employing specialist design agencies who are well-versed in demographic network distribution will be crucial for each project. 

Data Collection: Gathering reliable data on broadband availability and speeds can be difficult, especially in rural areas where infrastructure is sparse.

– Coordination and Collaboration

Inter-Agency Coordination: Effective implementation requires coordination between multiple state agencies, local governments, and private sector partners. This can be complex and time-consuming. Each project within this program needs to be intricately managed. 

Public-Private Partnerships: Establishing and managing partnerships with private companies to leverage their expertise and resources while ensuring public interests are met can be challenging.

– Funding and Resource Allocation

High Costs: Deploying broadband infrastructure in rural and remote areas is expensive due to lower population densities, rough terrain, and limited road access.  

Resource Allocation: Ensuring that funds are allocated efficiently and equitably to the areas that need them most requires careful planning and oversight.

– Regulatory and Legal Issues

Permitting and Rights-of-Way: Navigating the regulatory landscape for permits and rights-of-way can delay projects. Simplifying these processes is crucial but often difficult to achieve. 

Legal Challenges: States may face legal challenges from existing service providers or other stakeholders, as seen in Rhode Island.

– Technical and Logistical Challenges

Infrastructure Deployment: Building and maintaining broadband infrastructure in challenging terrains and remote areas requires significant technical expertise and logistical planning. 

Technology Choices: Deciding on the most appropriate technologies (e.g., fiber, fixed wireless, satellite) for different areas can be complex and context-dependent.

– Community Engagement and Adoption

Public Awareness: Raising awareness about the benefits of broadband and encouraging adoption in communities that have historically lacked access can be challenging. 

Affordability: Ensuring that broadband services are affordable for all residents, especially in low-income areas, is a critical issue. 

Highlights of the BEAD program so far 

We can already see some incredibly effective usage of the BEAD program process and used funding. 

Colorado has made significant strides with its Advance Colorado Broadband program. The state opened applications for $826.5 million in BEAD funds, aiming to enhance connectivity across rural and underserved areas. This initiative is expected to boost economic development, education, and healthcare access throughout the state. 

We can see that Kansas has also been proactive, opening a 45-day pre-application window for projects utilizing its $451 million allocation. This early action has positioned Kansas to quickly implement broadband infrastructure projects, ensuring that more residents gain access to reliable internet. 

If you look at Louisiana, you’ll see that they launched a prequalification portal for its $1.36 billion disbursement. This step is part of the state’s strategy to streamline the selection process for sub-grantees and accelerate the deployment of broadband services, particularly in rural and underserved communities. 

Finally, Minnesota received approval for its BEAD funding and is set to invest $600 million to expand high-speed broadband access. The state aims to connect more residents to the Internet, enabling them to participate in the digital economy, access online education, and improve their quality of life. With early approval, they have received a head start on their project implementations.  

What can other states do to accelerate their projects effectively? 

Other states can learn several valuable lessons from the success stories of Colorado, Kansas, Louisiana, and Minnesota in utilizing BEAD funding effectively. The proactive planning seen within these states can no longer be mimicked due to the impending final deadlines, but states can work to be proactive with their Sub-grantees. 

States can also work on streamlining their process across the program in its entirety. Louisiana’s prequalification portal is a great example of streamlining the selection process for sub-grantees. Simplifying administrative procedures can help accelerate project timelines and reduce bureaucratic delays. By prioritizing rural and underserved areas, as seen in Minnesota’s strategy, states can further ensure that the most disconnected communities receive the necessary infrastructure improvements. This focus will only help to bridge the digital divide more effectively. 

Efficiently considering their partnerships is another crucial point for states. We’ve already seen that successful states have been often engaging in strong collaborations with local governments, non-profits, and private companies. These partnerships are helping to leverage additional resources and expertise, enhancing the overall impact of the projects. Partnerships with private service providers are also helping with their community engagement. Maintaining transparency and actively engaging with the community, as seen in some states’ public comment processes, has helped to build trust and ensure that the projects meet the actual needs of the residents.  

Finally, the last recommendation for states still mapping their projects and implementation/deployment plans is to carefully – very carefully – consider the end broadband pricing. Ensuring that broadband services are affordable to their residents and businesses is crucial. States can learn from the debates and adjustments around low-cost plans to make sure that the infrastructure investments translate into accessible services for all residents. Having open-access networks is 100% the best way to go, as this allows residents to choose their provider and pricing, rather than being stuck with only 1 option.  

What’s next for BEAD? 

To summarize everything we’ve explained so far, we are at a critical point in the BEAD process as it stands today. With the deadline for final proposals from states rapidly approaching – December 01, 2024 – we are waiting for NTIA to issue final approvals and allow each state to properly launch its projects.  

As states were able to access 20% of their funds following their initial proposals, it’s expected that most have started to progress their Sub-Grantee applications and work to distribute – or at least allocate – their funding down to jurisdictions, local governments, and more. Once these sub-grantees are selected, each of them will begin the fast-paced battle to get their networks designed, constructed, and active as quickly as possible.  

There are significant resourcing issues within the US at the moment, primarily in the construction phase of the networks, so the sooner the states sort out their funding, the sooner their residents can get connected. Depending on the network choice the time-to-live of the network is very different, and the reliability of the network is very different. 

Although there is favor for all networks to be fiber due to their speed, reliability, and future-proofed capability, in late August NTIA issued draft guidance related to alternative technologies, saying that states could use unlicensed wireless spectrum technologies and satellite broadband for BEAD projects. This has not been confirmed yet, and with it being draft guidance, it may be quickly revoked.  

The BEAD program represents a significant federal effort to bridge the digital divide and promote digital equity across the United States. While there are challenges to overcome, the successes seen in states like Colorado, Kansas, Louisiana, and Minnesota demonstrate the potential for transformative impact. 

If you’re on track to receive BEAD funding and need support with your fiber network design, deployment, integration, and project management, get in touch with NetPMD today.