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Regulation - What is it Good For?

Using ARPA Funding

I’m getting a lot of calls asking about ways that local ARPA (American Rescue Plan Act) funds can be used for broadband. Many of these questions are coming as the result of cities and counties being told they can’t use the funds to build broadband. In some cases, conservative local legal opinions are cautioning against using the money. We’ve heard of examples where big ISPs are telling communities they can’t use this money. In my state of North Carolina, the State Legislature has gone so far as to warn local governments that if they build infrastructure with ARPA that they won’t be eligible for state grant funding.

The reality is that the Department of Treasury has written the rules in such a way that communities have a huge amount of control over how they can use the ARPA funds. The only big overriding rule is that the funding must address some problem created by the pandemic – that’s an incredibly easy hurdle to cross with anything related to broadband. I’m not going to repeat the basic grant rules which are discussed in this earlier blog – but the blog is a good reminder that Treasury worked hard to make the funding easy to use.

I’m starting to hear some interesting stories from cities that want to use the money for broadband. Following are a few of the ideas that I know are being considered:

  • I know cities that are considering using ARPA money to bring broadband to public housing and to low-cost neighborhoods. These cities want to provide free or low-cost broadband to citizens who have not been able to afford broadband. This goes far past using the $30 discount from the Affordable Connectivity Program – $30 off cable company broadband connection is still out of reach for many homes.
  • There are cities using the money to create a wireless system to reach all students at home so that every student is guaranteed a connection for doing homework.
  • There are cities connecting to anchor institutions with fiber to reduce the ongoing cost of paying to connect city buildings.
  • I know cities that are looking to build fiber to business districts that have been devastated during the pandemic. Smaller communities aren’t going to fully recover from the pandemic until local merchants and local jobs are up and running again.
  • If you know of other ideas for using ARPA in cities, I’d love for you to describe them in the comments section of this blog.

Rural counties and small towns are mostly focused on bringing broadband to rural areas that have poor or no broadband. Rural communities are mostly partnering with local ISPs to bring better broadband.

  • I know several counties that are using ARPA money as matching funds for state and local grants. Communities are recognizing that the most powerful use for this money is to use it to attract larger grant funding from elsewhere. Many states are encouraging this. I saw a presentation recently from the Virginia grant office that encourages localities to layer local, state, and federal grants together to bring broadband to high-cost places.
  • I know a few communities that are taking the idea of collaboration to the next level past state and federal grants and are also attracting funding from schools and libraries, rural health care facilities, electric cooperatives to create the funding plan to bring broadband to every stakeholder.
  • I know of counties that plan to use the funding to directly build broadband to places they fear nobody else will serve.
  • I’ve also heard of a few cases of counties that are using the money to build middle-mile fiber with a partnership in place for an ISP to bring the funding to build the last-mile networks.

In all of the above cases, the ARPA money can be used for the engineering and feasibility study work needed to quantify the costs of a project.

My bottom-line advice is to ignore those who are telling you that this funding can’t be used for broadband. I think Treasury made it abundantly clear that communities get to call the shots about how they want to use the funding. Once this funding hits your coffers, it’s your money – as long as you follow a few simple guidelines.

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