Residents in rural America are eager to access high-speed internet under a $42.5 billion federal modernization program, but not a single home or business has been connected to new broadband networks nearly three years after President Biden signed the funding into law, and no project will break ground until sometime next year.
Lawmakers and internet companies blame the slow rollout on burdensome requirements for obtaining the funds, including climate change mandates, preferences for hiring union workers and the requirement that eligible companies prioritize the employment of “justice-impacted” people with criminal records to install broadband equipment.
The Commerce Department, which is distributing the funds under the Broadband Equity Access and Deployment (BEAD) program, is also attempting to regulate consumer rates, lawmakers say. This puts them at odds with internet providers and congressional Republicans, who say the law prohibits such regulation.
The slow pace of funding allocation and compliance will push the project start dates for modernizing rural internet access to 2025 and 2026, according to a timeline officials outlined in a House budget hearing.
Federal Communications Commissioner Brendan Carr said the program’s goal of providing high-speed internet to most underserved areas will not be fully realized until 2030, nine years after its enactment.
Rural areas have been waiting a long time for broadband service. Many rely on slow internet that travels over copper lines and are unable to transmit large amounts of data. Some areas have no internet at all.
“There hasn’t been a single shovel’s worth of dirt that has even been turned towards connecting people,” Mr. Carr said.
As of this month, nine states and the District of Columbia have been approved for the BEAD program. President Biden signed the funding into law in November 2021 as part of the $1.2 trillion bipartisan Infrastructure Investment and Jobs Act. All 56 states and territories have submitted initial proposals seeking a portion of the $42.5 billion.
Alan Davidson, who runs the program as head of the Commerce Department’s National Telecommunications and Information Administration, praised the pace of the BEAD program. He told lawmakers in May that the first two years were consumed by “planning and preparation.”
Mr. Davidson said 2024 “is a year of execution — the year for which we’ve been planning.”
States and territories approved for funding, he said, “will be embarking on the challenge and subgrantee selection processes that will fund providers to build networks.”
On May 15, Mr. Davidson told Congress that the program “is really a 2025, 2026 shovels-in-the-ground project.”
Critics say the deployment of funding is taking far too long and government requirements are thwarting the approval process and threatening to derail broadband projects.
Mr. Carr accused the NTIA of taking too much time to approve applications from states.
“They just put too many steps in the process,” he said. “The addition of a substantive wish list of progressive ideas they’ve layered in certainly didn’t help with the timeline.”
Senators have repeatedly written to Mr. Davidson to complain about funding requirements related to labor, climate change, and diversity, equity and inclusion that they said were added to the BEAD program after it was signed into law.
“As numerous states and stakeholders have articulated, current BEAD rules divert resources away from bringing broadband service to rural America and are inconsistent with NTIA’s statutory authority in the Infrastructure Investment and Jobs Act,” 11 Republican senators wrote to Mr. Davidson. “NTIA’s failure to resolve these concerns will prolong the digital divide and put billions of scarce taxpayer dollars at risk.”
The letter outlines a list of stipulations for obtaining the funds that lawmakers say are not part of the law and should be eliminated.
They include:
• Preference for hiring union workers, who are scarce in some rural areas.
• Requiring providers to prioritize “certain segments of the workforce, such as individuals with past criminal records,” when building broadband networks.
• Requiring eligible entities to “account not only for current [climate-related] risks but also for how the frequency, severity, and nature of these extreme events may plausibly evolve as our climate continues to change over the coming decades.”
Lawmakers also protested provisions in the BEAD program giving preference to government-owned networks, which critics say put taxpayers at risk and have sustained financial losses around the country.
“Time and time again, such networks have squandered public dollars and left taxpayers holding the bag,” the National Taxpayers Union said in a letter to Sen. John Thune, South Dakota Republican.
A separate group of senators, all Republicans, wrote to Commerce Secretary Gina Raimondo to say that the BEAD program requirements conflict with congressional intent and would deter broadband deployment. One of the contested provisions allows only expensive fiber internet to qualify for funding, which could make rural and remote connections much harder and far more costly.
The senators said the program’s nine-step review process “is likely to mire State broadband offices in excessive bureaucracy and delay connecting unserved and underserved Americans as quickly as possible.”
They disputed a requirement added by NTIA that eligible states participate in federal digital equity programs, which “aim to ensure that all people and communities have the skills, technology, and capacity needed to reap the full benefits of our digital economy.”
The letter cited BEAD’s planning section on “climate resiliency,” which senators said requires extensive research, reporting and justifications “that are typically well beyond the focus or expertise of State broadband offices.”
The NTIA did not immediately respond to an inquiry about the complaints concerning the BEAD program requirements.
In a June 11 letter to Mr. Davidson, Sen. Eric Schmitt, Missouri Republican, accused the BEAD program of attempting to regulate broadband service rates, which he said violates the law.
Mr. Schmitt also accused Mr. Davidson of “aggressively insisting” that states, in this instance Virginia, offer a low-cost option “at a pre-set price” as a condition for receiving any of the federal funding.
Rate setting is illegal outside public utilities, and Mr. Davidson and Ms. Raimondo deny that they are engaging in rate regulation. Ms. Raimondo told senators at a budget hearing that low-cost proposals from states seeking BEAD funding “have to satisfy us.”
Mr. Schmitt accused Mr. Davidson and Ms. Raimondo of “engaging in double talk” on their rate demands and threatened to “use the fullest extent of our oversight authority” to hold them accountable.
In the meantime, the Biden administration is celebrating the rollout of the funding that started this year.
In April, Mr. Biden announced the approval of billions of dollars in funding for Kansas, Nevada and West Virginia to begin planning and implementing the high-speed internet rollout under the BEAD program.
“Today’s announcements mark another milestone in the effort to close the digital divide across America,” Mr. Davidson said.
• Susan Ferrechio can be reached at sferrechio@washingtontimes.com.
Please read our comment policy before commenting.