The $42.5 billion Broadband Equity, Access, and Deployment (BEAD) program aims to close the digital divide in the United States, but several challenges are slowing its progress. On Tuesday, September 10, 2024, the House Communications & Technology Subcommittee held a hearing titled “From Introduction to Implementation: A BEAD Program Progress Report” to discuss the progress of the program. While many states have received approval from the National Telecommunications and Information Administration (NTIA) for their Initial Proposals to allocate funding, others are still awaiting authorization. The hearing highlighted ongoing uncertainties around key issues such as state Final Proposals, NTIA’s permitting system, and more.
Key Challenges Discussed
Multiple obstacles facing the BEAD program were discussed during the hearing. Among them:
- Accurate Mapping: Witnesses and committee members emphasized that identifying where funds are most needed has been difficult due to mapping issues. The FCC maintains and updates the National Broadband Map, yet this is an ongoing process. The BEAD Challenge Process is intended to result in more accurate data to target BEAD funding, yet lags in data sets from the FCC (in addition to issues about the data that service providers are required to report) leads to disputes about what levels of service (if any) are, or are not, available at a given location.
- Technology Deployment: NTIA recently asked for comment on proposed guidance regarding “Alternative Technologies.” Committee members and witnesses discussed various perspectives on NTIA’s preference for fiber-based broadband, followed by others such as cable, DSL, and licensed fixed wireless. Alternative Technologies are generally regarded to include unlicensed wireless and Low Earth Orbit (LEO) satellites. While all agreed there is a need for a wide array of choices, there are differences of opinion on how NTIA and states should approach various alternatives.
- Permitting: Several committee members and witnesses noted that despite efforts to streamline requirements, federal, state and local permitting rules can result in significant delays for broadband projects. There was discussion of providing funding to local governments to enhance permitting staff, although this is only a proposal at this point. A state broadband official noted that NTIA will require states to use a specific system to evaluate environmental and historic preservation aspects of projects. However, this system is not expected to be available for another six to eight months, introducing uncertainty that may impede the award of funding.
- Workforce Shortages: Workforce shortages were also identified as a barrier to broadband deployment. With the simultaneous expansion of broadband infrastructure across all 56 states and territories, the demand for skilled labor is expected to outstrip supply. Witnesses noted that local training and apprenticeship programs may help alleviate this problem, although the timing and degree of relief these can offer are not certain.
Debate Over the Low-Cost Option Requirement
A key point of debate among subcommittee members and witnesses was whether the program’s low-cost option requirement amounts to rate regulation. Opinions remain divided on the issue. Under the Infrastructure Investment and Jobs Act (IIJA), the NTIA is prohibited from regulating broadband rates, yet states receiving BEAD funds are required to define a low-cost broadband service option. Some argue that NTIA’s role in approving these low-cost plans effectively amounts to rate regulation, while others insist it’s a necessary step to ensure affordability.
The Impact of the Affordable Connectivity Program (ACP)
The hearing also noted complications related to the recent conclusion of the Affordable Connectivity Program (ACP), which provided subsidies to low-income consumers before its funds were depleted this spring. The ACP was expected to complement BEAD funding by making broadband more affordable for low-income households. Now that ACP funds have run out, BEAD’s ability to serve underserved populations could be hindered. Proposals to re-fund the ACP have been offered in Congress. While several witnesses and committee members were very supportive, the prospects of passage remain uncertain. Alternatively, some members and witnesses also explored enhancing the current low-income programs of the existing Universal Service Fund to address this issue. However, various legal and procedural issues make it likely this would take specific Congressional action. While this is being discussed on Capitol Hill by a bipartisan working group of Senators and Representatives, it remains a work in progress.
What’s Next for the BEAD Program
Although all states and territories submitted their Initial Proposals to the NTIA in December, additional guidance continues to emerge, and more is anticipated. In terms of next steps, each state must submit a Final Proposal within one year of their Initial Proposal approval, outlining specific subgrantees and the areas to be served. As new guidance continues to emerge, states and municipalities must navigate a complex landscape of funding and regulations.
How Mission Broadband Can Help
At Mission Broadband, we are closely monitoring BEAD developments. Whether you are a service provider formulating your BEAD strategy, a government entity navigating the evolving landscape, or a consulting firm looking to expand capacity as new details emerge, we’re here to help. Reach out to see how we can support your broadband deployments and funding efforts.