BEAD Grants for Small Pockets of Customers

One of the most interesting aspects of the BEAD grants is that the funding is intended to make sure that everybody gets broadband. There is one section of the grant rules that talk about how the funding can be used to serve areas as small as a single home. Following are two quotes from the BEAD rules:

Project—The term “project” means an undertaking by a subgrantee to construct and deploy infrastructure for the provision of broadband service. A “project” may constitute a single unserved or underserved broadband-serviceable location, or a grouping of broadband-serviceable locations in which not less than 80 percent of broadband-serviceable locations served by the project are unserved locations or underserved locations.

Unserved Service Project—The term “Unserved Service Project” means a project in which not less than 80 percent of broadband-serviceable locations served by the project are unserved locations. An “Unserved Service Project” may be as small as a single unserved broadband-serviceable location.

This is something that is badly needed because in every county I’ve worked in, there are small pockets of folks that have been left out of other broadband expansion projects. To give an example, I was working with a county where there is a small pocket of about fifteen homes that are between the areas funded by two state grants. The homes are along a State highway, which means higher construction costs. The earlier state grant applicants ignored the area because of the high costs.

I’m curious about how small areas like this one can fit into the complicated BEAD grant rules. I’m sure the two different ISPs that decided not to build these area would do so if they got enough funding – which should be available from BEAD. But I can’t picture any ISP going through the massive hassle of plowing through the BEAD application and the myriad of rules to get the money to serve fifteen homes. I already know a lot of small ISPs that are thinking about skipping the BEAD grants entirely because of the complexity.

I’ll be interested to see how the State Broadband offices tackle this issue when they publish their draft grant rules. I would not expect any ISP to ask to serve small pockets of customers if they have to jump through the full gamut of the BEAD hoops. Will State Broadband offices come up with a simpler mechanism for these stray pockets of homes?

We’ve seen simpler mechanisms used for small pockets of homes in some state grants. For example, several states have used the concept of loop extension grants to fund homes that are close to an existing broadband network. These grants fund drops and customer electronics only and not the infrastructure wiring along the streets. The loop extension grants can be requested for a single home or groups of homes in a neighborhood.

Will a State be allowed to deviate from the NTIA grant rules to reach the many tiny clusters that will otherwise not get broadband? A lot of the complicated rules for BEAD were dictated by Congressional legislation, and it might not be possible to hand out money to anybody that doesn’t meet all of those federal requirements. If an ISP needs a letter of credit, an environmental study, and to jump through many other onerous hoops, I can’t picture any ISP that will be willing to tackle small pockets of customers. Unfortunately, the language above classifies building to a single home as a project probably means that all of the rules associated with the BEAD grants will apply.