New Federal Funding Sources for Broadband Access and Adoption: Three First-Blush Recommendations for State and Local Government Leaders

As a result of the American Rescue Act (signed into law in March 2021) and the Consolidated Appropriations Act of 2021 (signed into law in December 2020), state and local government leaders have billions — perhaps tens of billions — to spend on broadband access and adoption in their communities. The recently passed laws establish new broadband funding initiatives and make available to state and local governments unprecedented levels of Federal funding for broadband. In this post, I identify the diverse funding sources that are available, consider the opportunities and challenges facing state and local government leaders and put forth a first-blush assessment of how state and local government leaders might seek to navigate challenges and advance impactful Smart Community initiatives.

American Rescue Plan

The American Rescue Plan (ARP) includes $360B for state and local governments. While there are many compelling and competing budget needs this funding will address, I certainly expect that some funding will go to broadband access and adoption. Some projects have already been announced. For example, the state of Maryland has declared publicly that they will use some of their ARP funding to advance broadband access and adoption. No doubt other state and local governments will draw on ARP funds to advance broadband-related projects and priorities.

The Act directs the U.S. Department of Treasury to distribute the funds directly to state, county and local governments. ARP allocates $220B to states. The Act includes language specifying that these funds can be used to invest in “infrastructure to build out of crisis.” ARP provides $130B for local governments. Language in the Act specifies that the funding can be used for investments in “water and broadband systems.” The Act allocates $65B to counties and $65B for cities and towns. The National Association of Counties (NACo) has released projected per county allocations of ARP funding. The National Conference of State Legislatures (NCSL) released project locations for state and local jurisdictions. Finally, the Act provides $10B for a Capital Projects Fund intended to help states, territories, and Tribal governments fund capital projects that enable remote work, education, and health monitoring.

In addition to the funding that will be distributed by the Treasury Department, ARP also establishes a $7.17B Emergency Connectivity Fund to reimburse schools and libraries for providing broadband service and connected devices for students and patrons to use in their homes. This funding is slated to be introduced into the Federal Communications Commission’s E-Rate program.

Consolidated Appropriations Act of 2021

The Consolidated Appropriation Act of 2021 includes funding for several broadband specific programs and initiatives, including:

· $3.2B for an Emergency Broadband Benefit (EBB) program

· $250M of expanded funding for the FCC’s Telehealth Program.

· $285M for a Connecting Minority Communities Pilot Program administered by NTIA

· $1B for a Tribal Broadband Connectivity Program administered by NTIA

· $300M for a Broadband Infrastructure Deployment Program administered by NTIA

Various rules and guidelines will govern these different programs. The FCC has approved the rules for the EBB program and is currently working on the processes and systems needed to administer the EBB Program. NTIA has announced a series of webinars during which it will announce the guidelines, policies and timelines for the three grant programs in will administer.

Three Recommendations for State and Local Government Leaders

Here, I offer a first-blush assessment of how state and local government leaders might seek to navigate challenges related to the newly available Federal funding. In future blog posts, I will explore in detail how state and local government leaders might most effectively take advantage of block grants and develop compelling applications for available competitive grants.

Establish a game plan. Due to the complexity of the competitive grant programs and the flexibility of the block grants, state and local government leaders will be called upon to develop plans that will impact a wide array of key project stakeholders. Recommendation: Where pre-existing Smart Community initiatives and plans were developed using a transparent, consensus-driven process, state and local governments should work to build upon them — and, if possible, regionalize them!

Balance short term benefits and long-term benefits. Some of the newly available funding provides unique opportunities designed to help a community address acute and short-term needs. Recommendation: Local government leaders should take stock of the fact that it is unusual that adequate Federal funding is available for device and broadband services subsides for lower-income communities and broadband adoption programs (e.g., digital navigator programs) and should consider prioritizing these initiatives.

Avoid technology for technology’s sake. Even during an apparent ‘time of plenty’ for local government leaders who have an interest in advancing Smart Community initiatives and broadband projects, investments in technology are most valuable when the investments have a clear and direct tie to the lives of residents. Recommendation: Local government leaders should insist that all proposed projects include specific key performance Indicators (KPIs) that will measure improvements in residents’ quality of life (e.g., health, economic opportunity, etc).

About this Medium Site

On this Medium site, I explore an array of topics related to the transformative power of smart and connected communities. A central question for this observer of the so-called smart community movement: how will municipalities, real estate developers, universities and other leading organizations develop, deploy and support smart and connected community projects at scale?

I welcome feedback and comments from readers.

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Bill Maguire

A recovering policy wonk, Bill is passionate about the transformative power of advanced networks, open data, machine learning & the Internet of Things (IoT).