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Regulation - What is it Good For?

BEAD Grants in High-cost Areas

There are two interesting aspects of the BEAD NOFO that discuss how States might deal with parts of the country that have higher than average costs. As a reminder, when reading the following, Eligible Entity means a State broadband office. The two provisions are as follows:

An Eligible Entity may decline to select a proposal that requires a BEAD subsidy that exceeds the Extremely High Cost Per Location Threshold for any location to be served in the proposal if use of an alternative Reliable Broadband Service technology meeting the BEAD Program’s technical requirements would be less expensive.

 If no Reliable Broadband Service technology meeting the BEAD Program’s technical requirements would be deployable for a subsidy of less than the Extremely High Cost Per Location Threshold at a given location, an Eligible Entity is authorized to select a proposal involving a less costly technology for that location, even if that technology does not meet the definition of Reliable Broadband Service but otherwise satisfies the Program’s technical requirements.

Let’s unpack these two sections of the NOFO. The first citation says that in areas with high costs, a State should strongly consider using the lowest-cost technology that the NTIA has defined as capable of providing broadband speeds of at least 100/20 Mbps. To give an example, a State should give a preference in high-cost places to use fixed wireless using licensed spectrum instead of fiber.

The second quote goes further and says that a State can go even further and consider using a technology that is not considered capable of providing reliable broadband service. That might mean rejecting a proposal to build fiber and awarding funding to a satellite provider that promises to deliver 100/20 Mbps.

I can foresee both positive and negative aspects of this approach. Unfortunately, at this point, the NTIA hasn’t defined what extremely high-cost means and the NTIA plans to issue more guidance. I read the NOFO to require each state to define high-cost based on the local situation.

On the positive side, there are many remote locations that are extremely costly to reach with wired technology. Homes on mountaintops or deep in canyons might be unreachable with the technologies listed by the NTIA as capable of providing reliable broadband (fiber, coaxial cable, DSL, and fixed wireless using licensed spectrum). It seems practical not to waste grant money to build technology to reach really remote homes.

But then I start looking at a lot of real-life situations, and I get worried about this provision. By definition, practically any homes in the woods in Appalachia, the Ozarks, or the Sierra Nevadas will cost a lot more to reach than homes in the plains of Iowa or Minnesota. It costs a lot more to get broadband to the many folks who live on islands because of the backhaul. Homes that happen to be near federal parks or other federal lands are often going to cost a lot more to reach because of the added paperwork. Does the NOFO give a State the cover to write such places off or fund to technologies that are not considered to provide reliable service?

I find that a bit ironic since there is a statement in the NOFO goals about wanting to reach everybody with good broadband – the NTIA said states should consider a grant request to serve even a single remote home. Part of me says that the whole intent of Congress is to reach exactly these high-cost places – they are the ones that really need the federal subsidy.

I worry about the ability to substitute technologies in places like heavy mountains and woods. The only reliable broadband in such places is a wired network. I know wireless vendors claim the ability of wireless technology to penetrate trees and woods, but it doesn’t work well where there is nothing but woods along with rough terrain where lines of sight are impossible.

Each state is going to have a public comment period, and counties and communities that have the more challenging costs and terrains need to pay close attention to your state’s proposed plan to make sure the state isn’t going to write you off before the grant process even begins. That challenge process might be the only chance you’ll have to get good broadband.

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