Big Changes in Federal Grants

There was an Executive Order (EO) in August from the White House that made some fundamental changes to the way that federal grants work – some positive and some negative. The EO is titled Improving Oversight of Federal Grantmaking.

The Order instructs the Office of Management and Budget (OMB) to overhaul the Uniform Grant Guidelines (2 C.F.R. Part 200) and other related documents related to all federal grants. The new rules are going to impact every stage of the grant life cycle, from the application process through compliance. The rules don’t only impact future grants but potentially affect all existing grants that are in the process of being implemented. Following are some of the key changes from this EO.

Stronger Oversight and Accountability. Each agency must name a senior appointee who will manage the process for all new grants. Before any new funding opportunity is announced, it must undergo review and approval by the senior appointee. This process mandates input from subject-matter experts, identified by the agency head. Grant announcements must be “written in plain language”. The senior appointee must review all open grant programs every year to assess progress and to make sure the program is still consistent with the agency priorities. Prior to issuing grant awards, the grant panel or program officers who will be making the awards must engage in a meeting with the senior appointee. Until the new review process is in place, agencies are prohibited from issuing new grant opportunities.

Grant Restrictions. Grants cannot be used to fund, promote, encourage, subsidize, or facilitate 1) racial preferences, 2) denial that sex is binary and that sexual preferences are chosen or mutable, 3) illegal immigration, or 4) any initiative that compromises public safety or promotes anti-American values.

Grant Applications. Grant applications must be more accessible and less burdensome. All parts of the application process must be written in plain language. Applications should only include requirements that are strictly necessary for a review of the application. The decision on who wins grants rests with the senior appointee or their designee. Grant awards must be consistent with administration policies and statutory requirements.

Termination for Convenience. All grants must include terms that allow the grant agency to terminate a grant “for convenience”. This means an agency can cancel a grant at any time and doesn’t need a reason. An agency can decide to change priorities and cancel all open grants that don’t meet the new priorities. Current grantees must agree this change for existing grants.

Grant Drawdowns. Grantees will be required to provide a detailed, written justification for each drawdown request. This is to prevent premature use of federal funds and to make sure that disbursements are tied to project milestones and agency oversight.

Limitations on Overhead Costs. The EO directs the OMC to revise the Uniform Guidance to restrict the use of grant funds to cover facilities and administrative expenses. This might include costs like administrative salaries and general institutional support.

What Does This Mean for a Grant Recipient?

It’s positive that grant applications should be easier. Some federal broadband grants have complicated instructions and forms.

The biggest change is that a grant recipient has a new risk that grants that cover multiple years might be canceled before the project is completed. Agencies don’t need a reason to cancel a grant and can do so at their convenience. This adds new risk for accepting a federal grant, with the risk increasing as a project is partially implemented.

It sounds like drawing funds will take more work. Gone will be any grant draws that are not based on actual invoices or milestones.

To some degree, this potentially dilutes grant programs developed by Congress since the Agency in charge of the grant seems to have more discretion in determining the grant rules.

Broadband Technology Improving

As has happened continuously since the introduction of DSL and 1 Mbps cable modems, the major broadband technologies continue to evolve and get faster.

Cable HFC technology is getting faster. Harmonic, one of the makers of core cable broadband technology, recently announced that the company had achieved a 14 Gbps speed with DOCSIS 4.0. The test was achieved during a CableLabs interoperability event. The speed was achieved in a mock-up that included achieving the faster speed using technology provided by multiple other vendors.

The test was achieved with an updated CMTS (which is the main hub router in a cable modem network). The speed beats the old record of 10 Gbps, also achieved by Harmonic. It’s unlikely that any cable companies will try to achieve that speed since it would mean sacrificing some upload speeds with current DOCSIS 4.0 technology. But a faster CMTS would allow a cable company to offer a true 10 Gbps download product. These kinds of breakthroughs are also important since they are the first step towards developing the next generation of electronics.

Faster home broadband service from fiber is also improving. Earlier this year, Nokia announced the availability of two different 25 Gbps customer modems, making it realistic for ISPs to offer the faster 25 Gbps service on a PON fiber network.

Nokia also recently announced the release of a 25G PON card for the network core that can simultaneously support all of the flavors of PON, including GPON, XGS-PON, and 25G PON. The company said the card would easily be able to handle the upcoming 50G PON. Having a core with this flexibility will allow ISPs to keep customers on older GPON technology without having to force an update when the newer technologies are introduced to the network.

Finally, Nokia announced the release of some new home WiFi 7 gateways for the home. The  Beacon 4 gateway can reach speeds of 3.6 Gbps, and the tri-band Beacon 9 gateway offers 9.4 Gbps speeds. These are added to a line of gateways that top out with the Beacon 24, which can achieve home WiFi speeds of 24 Gbps. The new generation of WiFi 7 routers offers the possibility of superfast speeds inside the home using 6 GHz spectrum, while at the same time still connecting to older devices using 2.5 and 5 GHz spectrum.

Another major announcement is the new generation of Tarana radios for fixed wireless. The specifications on the new radios are a leap forward in capacity and performance. The first-generation G1 radio platform could support up to 1,000 customers per tower, 250 per sector. Each sector could accept up to 2.5 gigabits of backhaul bandwidth. The new G2 platform can support up to 512 customers per sector (2048 for a tower). The radios can accept as much as 6 gigabits of backhaul bandwidth per sector.

We can’t leave out satellite technology. The first-generation Starlink satellite weighed around 570 pounds and had a total downlink budget of about 20 Gbps. Starlink is introducing its third generation of satellite that weighs almost 4,200 pounds and has a downlink budget of 1 Tbps and 160 Gbps in aggregate uplink capacity.

This is a sampling of technology improvements and is not meant to exclude improvements being introduced by other vendors. There are many other important improvements including faster lasers for long-haul fiber routes and point-to-point broadband connections using light.

My USF Comments to Congress

A bipartisan group in Congress is tackling the topic of USF reform. They created a portal to solicit comments, which are not being made available to the public. I provided comments to the group on two topics.

The first is Lifeline support, specifically for low-income MDUs. There are two issues faced by those trying to bring broadband to MDUs that have tenants who can’t afford a broadband subscription. The first issue is bringing the needed infrastructure for better broadband. There was hope that BEAD might provide some of the needed solution since non-deployment funds could be used to upgrade low-income MDUs. However, it looks like NTIA might not give the non-deployment funds to states, even though that was mandated by Congress. I’m working with some non-profits that are looking for other ways to fund infrastructure upgrades.

The bigger issue is that the landlords or ISPs that serve low-income MDUs need some ongoing subsidy since tenants can’t afford to cover the cost of broadband. Lifeline can be used for that purpose today in a limited way. However, most Lifeline recipients direct the savings to their cellphone rather than to home broadband.

I’ve suggested some changes to Lifeline that could make it a powerful tool for improving broadband in low-income MDUs.

  • At least for these MDUs, the FCC should double the current $9.25 Lifeline subsidy. That would be enough to make a meaningful subsidy for monthly broadband for a building. It would be great if the Lifeline subsidy were increased in the future for inflation. The $9.25 subsidy meant a lot more when it was created in 1997 than it does today.
  • Landlords should be able to become Lifeline recipients on behalf of their tenants. It would be particularly beneficial if landlords could require tenants to assign them the Lifeline as a component of a rental agreement. For the assignment of Lifeline, a landlord would provide free broadband.

My other comments to the Working Committee were related to the giant subsidy programs in the High-Cost Program. Anybody who has been reading my blog knows that I think the FCC has done a poor job with some of these large subsidy programs.

The CAF II program that gave over $10 billion to the largest telcos was nearly a total failure. Telcos were supposed to use the money to upgrade rural DSL to 10/1 Mbps – but the program started making subsidy payments in the same year that the FCC increased the definition of broadband to 25/3 Mbps. There have been wide criticisms that the telcos never made many of the upgrades and just pocketed the summaries, such as this complaint filed by the Public Service Commission of Mississippi.

RDOF was not a massive failure and, in many cases, was successful, like with the many cooperatives that used the funding to build fiber to their members. But like CAF II, RDOF also failed in many ways. The program started by using terrible FCC broadband maps to define the RDOF areas, and this effort missed many millions of locations that should have been eligible, as witnessed by the many locations not eligible for BEAD. The program ended up with massive defaults on 1.9 million of the 5.2 million locations in the reverse auction. Probably the biggest problem was the mess the RDOF awards made of the broadband landscape by awarding a subsidy to a hodge-podge group of Census blocks that were interspersed with Census blocks that should have been included. This has made it highly challenging to find a broadband solution for the remaining areas and is a big reason that BEAD grant costs are higher than what people think they should be.

My recommendation to the Working Committee is that Congress should not allow the FCC to unilaterally create new giant subsidy programs on its own. It’s poised to launch the 5G for Rural America Fund that looks to have as many problems as the other past programs. Congress should find some way to get buy-in for new programs from outside the FCC. This sounds like a major criticism of the FCC, but this is a regulatory agency that is not staffed by folks who are attuned to what it takes to lure ISPs and carriers to solve the broadband and cellular gaps in rural America.

Here We Go Again

It looks to me like history is repeating itself. We’re seeing the same hype cycle for 6G that we saw for 5G. The big push for 5G was mounted on several fronts. Telecom vendors preached the wonderful new features that 5G would bring to the market. The big cellular carriers got on board and pushed for 5G as the easiest path to get the FCC to award them new spectrum. To be fair to the carriers, they definitely needed new spectrum because the 3G/4G networks were becoming badly overloaded. The government was brought on board to push for 5G with the story line that the U.S. was losing the 5G war to the Chinese.

5G proponents promised a lot of amazing improvements, which were largely dependent on two claims. First was that 5G would bring gigabit speeds that were ten times faster than 4G through the use of millimeter wave spectrum and new technologies like network slicing. There was a promise that latency would fall to less than 1 millisecond, significantly better than fiber. The hype for 5G was over-the-top. 5G was going to bring us self-driving cars powered by ubiquitous 5G networks along every road. 5G would enable doctors to perform surgery remotely from across the country. 5G was going to fuel an explosion of smart factories that would bring complex manufacturing back to the U.S. 5G speeds were going to eliminate the need for investing in expensive fiber networks.

We’re starting to see the same hype cycle starting for 6G. The carriers have been making a huge pitch over the last year to get more spectrum, and have already won the first half of that battle when the H.R. 1 legislation instructed the FCC to find 800 MHz of new mid-range spectrum for the carriers. The lead-up to that bill included policy lobbying claiming that the U.S. is losing the battle for 6G to the Chinese (sound familiar?).

Vendors are also leading the charge again. It’s not hard to understand their motivation since they will benefit tremendously from a new round of major upgrades to cell site electronics. When vendors make claims of future technologies, it’s as much to lobby the carriers as it is any policymakers. Today’s blog talks about the claims of upcoming technologies being made by Hemanth Sampath, Vice President of Engineering at Qualcomm in an interview with FierceNetwork.  In the interview, Sampath was asked about the user experience he expects to become mainstream in the next 5-10 years. His response not only requires a nationwide upgrade to 6G but also would mean a ubiquitous, constant connection between devices and AI data centers.

Sampath envisions a migration during the coming decade away from today’s technology that is app-based, and smartphone-centric or screen-centric. He believes we’ll quickly migrate to what he calls a more natural environment where people will pair smart glasses and a smartwatch to interact with AI agents. He said, “instead of just carrying one device like a phone, you’ll now have multiple devices that you’ll be carrying and you’ll be able to seamlessly work across these different devices by speaking to them, or the glasses see what you see.”

He admits that existing 5G can’t enable that future and that we’ll need an upgrade to 6G, which will have “the extra capacity, the foundational technologies to squeeze more capacity in the existing bands as well as provide new spectrum”. He believes new 6G standards will enable better AI-friendly protocols.

Along with 6G, his vision means that users would be constantly connected to a digital twin in the cloud that will process the inputs from smart glasses and other devices. A constant connection to an AI datacenter will be needed so that computing is done in the cloud to protect the battery life of personal devices.

It’s a bold vision, and one that will require huge capital investments from cellular carriers. The carriers had no choice but to make the upgrades to 5G to prevent a collapse of the 4G network. But in doing so, carriers realized that there was very little new revenue to be derived from increasing cellular bandwidth and capacity. The carriers recognized this quickly and all stopped far short of implementing the full set of 5G features. Carriers are going to be skeptical about making huge investments that depend on millions of people willing to foot the monthly bill that would enable Sampath’s vision. The one wildcard in the vision is that AI companies will support the idea, because just like the cell carriers, they are searching for a recurring revenue to support AI.

Going, Going, Gone?

We now know the next BEAD fight, and it might be the biggest fight yet. On September 5, NTIA issued a press release talking about the progress of the Benefit of the Bargain round for States to award BEAD funding. The press release announced that 36 of 56 States and Territories have made tentative BEAD awards and have submitted their final proposals to NTIA.

The header of the Press Release is that “Plans include broad range of technologies and save American taxpayers at least $13 billion”. The Press Release went on to say, “In the plans submitted today, states are already projecting savings of at least $13 billion for American taxpayers”.

The $13 million referenced by NTIA is the difference between the funding allocated to each state for BEAD and the amount being awarded to BEAD grants. According to the IIJA legislation that created BEAD, any funds not spent on infrastructure were to remain with the States to pursue other activities related to improving broadband. The legislation included some specific examples related to activities that promote the adoption and meaningful use of high-speed internet, including workforce development, digital literacy training, subsidies for internet-capable devices, telehealth initiatives, and the installation of Wi-Fi in multi-unit residential buildings. States were free to propose other ideas, and many have.

When NTIA issued the new rules for making BEAD grants in June, the agency said that funding for non-deployment funds was under review. It’s now pretty clear that NTIA plans not to expend the non-deployment funds and take credit for saving the expenditure for the U.S. Treasury.

The $13 billion number will grow. That amount comes from the States that have already submitted final plans. If the same ratio of non-deployment funds holds for the remaining states, then the amount of non-deployment will be around $25 billion. There are ten States where the non-deployment funds are more than $500 million, led by North Carolina at $1.1 billion and Georgia at $1 billion. The others include Arkansas, Kentucky, Louisiana, Mississippi, Ohio, Tennessee, Virginia, and West Virginia. Interestingly, the amount of non-deployment funding grew significntly when NTIS stressed making BEAD awards to satellite technology.

I describe this as a fight because States aren’t going to easily let this funding go. First, States have worked hard to reach consensus for specific plans for using the non-deployment funds. As an example, West Virginia plans to use non-deployment funds to create a database of utility poles in the state, to update security on the State’s own network, to award grants for expanding rural cell towers, and for training programs for technical jobs in the telecom sector. These are typical of the plans in other States and all work to further broadband deployment.

States are also unhappy about the NTIA statement because the funds were directed by Congress, and States believe they are entitled to the non-deployment funds. Louisiana Gov. Jeff Landry sent a letter to Commerce Secretary Howard Lutnick this week that emphasized that the non-deployment funds belong to the State. In Louisiana, the non-deployment funds are in the range of $850 million.

It’s not hard to imagine a coalition of State Attorneys General from red and blue states together suing NTIA to get the non-deployment funds. There are similar lawsuits underway for withheld funding for healthcare and education.

The bottom line is that a lawsuit might be inevitable. NTIA statements make it clear that it wants to claim the savings by keeping the non-deployment funds, and there are States that are likely not going to let the funds go without a fight. But maybe there is a compromise somewhere in the middle.

Canada Finally Orders Open-Access

The Canadian Radio-television and Telecommunications Commission (CRTC) ordered, in August 2024, that all broadband providers in the country open their networks to competitors on a wholesale open-access network. The original unbundling order applied to broadband provided on both cable TV and fiber networks. The original ordered that open-access be implemented by February 2025.

Similar to what happens in the U.S., various aspects of the rule were appealed at the CRTC. Through orders issued in June and August, the CRTC has modified a few requirements, but largely affirmed its original order and intent to require open-access.

While the order refers to this as open-access, a better analogy for the Canadian product is akin to what we call resale in the U.S. In Canada, the underlying network owner is still configuring the speed and delivering the product, and the open-access company is rebranding the product and selling and billing it to customers. Most U.S. open-access networks require ISPs to bring the backbone Internet and to set speeds and layer on additional products. However, some open-access sellers in the U.S. are closer to the Canadian model.

In October 2024, the CRTC set interim open-access rates for the largest ISPs. The three biggest ISPs in the country are Bell Canada, Telus, and Rogers. The rates are fairly high compared to many of the open-access rates in the U.S. A few examples:

  • Buying a broadband connection on the Bell networks at speeds up to 1,500 Mbps is $68.95 Canadian ($49.91 U.S.). Speeds greater than 1,500 Mbps are $78.03 ($56.50 U.S.).
  • The connection on Telus in Quebec for all speeds is $65.25 ($47.24 U.S.) while the rate in British Columbia is $80.41 ($58.22 U.S.).
  • Connection rates for SaskTel for all speeds are $77.57 ($56.16 U.S.).
  • CRTC also set standard rates for activities like service activation, moves and changes, and site visits.

The new orders made some refinements to the open-access rules:

  • Fiber deployed by Bell Canada, SaskTel, or TELUS after August 13, 2025 will not be made available for open-access until August 13, 2029. This will give fiber builders a head start in connecting customers on new networks.
  • The largest ISPs (both fiber providers and cable companies) can’t buy wholesale access on smaller ISPs within their traditional monopoly territories. This ruling is to push the big companies to expand networks and not rely on networks already built by smaller companies.

Four ISPs – Eastlink, Cogeco, the Competitive Network Operators of Canada, and SaskTel – had petitioned the CRTC to not allow the largest three ISPs to buy wholesale access on their networks. The most recent ruling said that everybody has to open their networks to competition. Cogeco has already said that it plans to take this new decision to court. Until now, the petitions were within the CRTC.

Numerous ISPs filed comments with CRTC saying that this ruling is a disincentive to building new fiber networks. The smaller companies fear that the biggest ISPs will win most of the customers on their networks due to their marketing advantage, and they said this will force them out of the business.

CRTC says it is going to closely monitor the competitive situation. As of the date of the recent orders, there has not been a lot of wholesale activity.

Death of the Fourth Cellular Carrier

The press has been full of recent headlines saying that EchoStar is finished as the fourth facility-based cellular network. EchoStar announced that it is selling 50 MHz of low and midspan spectrum to AT&T for $23 billion, to close in mid-year 2026. The spectrum being sold includes a 20 MHz swath of 600 MHz and a 30 MHz chunk of 3.45 GHz.

Over the weekend, it was announced that EchoStar sold 50 MHz of its AWS-4 and H-block spectrum to Space X for $17 billion to use for Starlink’s direct-to-cell service that will launch with the next generation of satellites. Exchostar’s Boost cellular customers will get access to that new service when it’s launched.

As a reminder, the EchoStar merged with DISH Networks and started using the brand name EchoStar for the cellular business. DISH Networks was promoted by the FCC to become a new nationwide cell carrier when the FCC approved the merger of T-Mobile and Sprint. DISH raised billions of dollars and started down the path of building a nationwide cell network. In doing so, DISH chose the interesting path of using open RAN electronics, which it believed would be more flexible and cost less than the electronics used by the other big cell companies.

DISH has been fighting for years to keep control of large swaths of spectrum. In addition to the spectrum being sold, the company holds 200 MHz, 700 MHz, and 1.7 GHz spectrum. The company had a hard time justifying all of the spectrum since as of May of this year, the company only had 1.25 million customers riding its own cellular network. The company was under investigation from the FCC for holding unneeded spectrum, but these sales should quiet that issues. EchoStar recently announced that it plans to launch a satellite constellation to compete for cellular service some of its AWS spectrum.

Echostar has been struggling financially, and recently averted a Chapter 11 filing when it was late in making a scheduled debt payment on July 1, but was able to do so before the 30-day grace period.  For those not familiar with the history of DISH Network, the largest stockholder is Charlie Ergen. He’s been adept over the years at finding ways to get out of threatening financial binds.

Echostar will continue to operate its other subsidiaries which include Dish TV, online platform Sling, and Hushes high-orbit satellite.

The timing of the spectrum sales is interesting because the company was finally making some headway in the cellular industry. When EchoStar announced its 2Q 2025 financial results, the big surprise was the continued growth of new cellular customers for the Boost Mobile brand. Echostar saw net growth of 212,000 customers for the quarter, up from 150,000 in the first quarter. This back-to-back growth is surprising since the company was losing customers a year earlier. Boost Mobile had 9 million customers when the company was first purchased, and had slipped to a low of 7.4 million customers.

As the headline says, this sale means the death of the EchoStar cellular network. The company discussed how it will try to sell off or scrap the assets.

The second quarter net growth for all of the major cellular carriers is as follows:Readers who haven’t seen a chart of cellular customer growth might be surprised to see how well Comcast and Charter are doing. It seems like both companies are putting a lot of emphasis on cellular growth to help offset the continued losses of broadband customers. The Verizon numbers might look dismal, but both Charter and Comcast largely ride the Verizon cellular networks with resold MVNO arrangements.

The sale of spectrum to AT&T is not good news for cable companies since AT&T said it would use the spectrum, in part, to expand its FWA home cellular business. AT&T was late to the game in launching FWA, and had 1 million customers at the end of the second quarter, compared to 5.1 million for Verizon and 7.3 million for T-Mobile.

The Accelerating Rate of Deregulation

We’re less than eight months into the new administration, and when considering that short amount of time, there has been an unprecedented amount of deregulation coming out of the federal government related to broadband and telecom issues. Regulatory changes aren’t just coming from the FCC, but also from the White House, NTIA, Congress, and other agencies like the FTC.

The trend to deregulate under a Republican administration is not a surprise. For example, we heard a lot of deregulation rhetoric when FCC Chairman Ajit Pai took over the FCC. His FCC tackled deregulation, but at a much slower pace than the current administration. Brendan Carr hit the ground running in this new administration when he was named as Chairman soon after the inauguration.

Following is a list I made of deregulatory changes I can recall that have happened this year, and I’m sure I’ve missed a few.

  • Chairman Carr came in with the intentions of killing Title II regulation of broadband and net neutrality, but was spared the effort when, in early January, the U.S Court of Appeals for the 6th Circuit struck down the regulations that had been adopted by the previous FCC.
  • The FCC’s signature deregulatory thrust has been labeled as Delete, Delete, Delete, which is a streamlined way to eliminate obsolete regulations. In practice, it appears that the FCC has decided to take shortcuts and has shortened the timeline or totally eliminated the ability for public comments before regulations are eliminated.
  • The FCC canceled rules that allowed the Universal Fund to pay for WiFi on school buses. The FCC is currently killing rules that would allow the USF to fund hotspots for lending in libraries.
  • The FCC made it easier for telcos to retire copper by putting a 2-year moratorium on public notices of upcoming copper retirements. The FCC is now working to make the temporary rules permanent.
  • In perhaps the biggest change, the White House ordered NTIA to cease the implementation of the $2.75 billion Digital Equity Act that was to be used for teaching people how to use computers, making sure every household had a computer or tablet, and promoting subscription to home broadband.
  • NTIA weakened the $42.5 billion BEAD grant program. The agency:
    • Watered down the assumed preference for fiber and tried to give more funding to alternative technologies like satellite.
    • Eliminated the mandate that anybody building a BEAD network had to have at least one broadband product that would be affordable for low-income households.
    • Weakened labor requirements and got rid of the preference for prevailing and union wages.
    • Perhaps the biggest long-term impact of the BEAD changes is that NTIA has seemingly defined satellite broadband as a legitimate broadband option for homes, meaning most homes can now be said to have a broadband option.
    • It looks like all of these changes might mean a $10-$20 billion reduction from the expected $42.5 billion program.
  • The FCC stopped the implementation of lower rates for telephone and video calls in jails and prisons.
  • The Federal Trade Commission halted the implementation of Click to Cancel, which would have mandated that any company that lets a customer subscribe online must make it just as easy to cancel service online.
  • While not specifically deregulation, the FCC has ignored its own timeline for kicking off the 5G for Rural America Fund, which is supposed to bring a lot more cell towers to rural America.
  • Courts continue to weaken the FCC’s authority. Several rulings in 2024 weakened the FCC. For example, Loper Bright Enterprises v. Raimondo overturned the Chevron Doctrine, which brings into question the ability of the FCC to enact laws that were not specifically mandated by Congress. This year, McLaughlin Chiropractic v. McKesson Corp gave District Courts more leeway to disagree with rulings made by federal agencies like the FCC.

To be fair, there are some new regulations to go along with the deregulation effort:

  • The FCC adopted some new regulations for poles related mostly to how pole owners must react to large orders for getting onto poles.
  • Congress reinstituted the spectrum auction for the FCC. However, that new law may reclaim some WiFi and CBRS spectrum for auction, which is key for rural and home broadband.
  • Tariffs on most imported goods have increased the cost of building broadband networks, particularly for electronics.
  • The FCC is suddenly opining on the content on network television and has threatened the broadcast licenses of the large broadcasters.

I couldn’t decide how to categorize the recent issue where the FCC said it was going to examine and try to kill any state regulation of AI. Should that be categorized as more deregulation, or an increase in federal regulation?

This is a huge number of changes for only an eight-month period, and I have to wonder how far the deregulation effort will go over the next few years.

FCC Examines Environmental Rules

The FCC recently released a Notice of Proposed Rule Making where the agency is looking to relax some of the rules related to NEPA (National Environmental Policy Act), mostly related to wireless infrastructure. The NEPA rules were created in 1970 as a reaction to air pollution and acid rain. The Act created the Council on Environmental Quality (CEQ) that oversees the implementation of the NEPA rules. I have to warn you that this order is chock-fully of jargon and not easy to understand for those not familiar with environmental regulations.

The NEPA rules are being examined in light of Executive Order 14154, signed in January and titled “Unleashing American Energy”, which rescinded Executive Order 11911 from 1977 that required CEQ to issue regulations for federal agencies regarding the implementation of NEPA.

This particular docket examines environmental rules that apply to locating wireless equipment. In a related effort, NTIA has told State Broadband Offices that it will be relaxing the need for expensive environmental studies for winners of most BEAD grants. For now, environmental studies are still needed for other grants like ReConnect. The FCC says this docket applies to commercial spectrum license holders, utilities, public safety entities, railroads, mining companies, and tower owners.

The FCC adopted rules in the past that make it easy to do normal broadband construction of all types without jumping through a lot of paperwork hoops. The existing FCC rules say that extra NEPA compliance doesn’t broadly apply to projects that “individually and cumulatively to have no significant effect on the quality of the human environment and are categorically excluded from environmental processing.” In practical terms, that has meant that projects like building privately-funded fiber in existing rights-of-way doesn’t need an environmental study.

However, the current FCC regulations recognize that there are circumstances, which are defined by a NEPA Checklist, where additional environmental study is justified. One event that triggers the exception is communications projects constructed on federal lands or projects funded with federal or state grant money. Such projects typically require full NEPA compliance. Those who have had to go through the environmental studies complain that they are costly and can delay projects by as much as a year. Construction can’t proceed until an exhaustive environmental review has been completed, at a cost as high as several hundred thousand dollars.

The FCC NPRM is also exploring whether any changes should be considered for compliance with the National Historic Preservation Act of 1966 (NHPA). Those rules have often been invoked by localities to restrict placing wireless towers adjacent to historic sites.

The NPRM was initiated due to a petition from CTIA, the Wireless Association, that represents the largest cellular companies, that asked to modify the rules by imposing short deadlines on environmental and historic preservation reviews.

The NPRM asks when it is appropriate for the FCC to invoke NEPA rules for wireless tower placement. The FCC suggests that it is not responsible for invoking NEPA rules for wireless licenses that cover large geographic areas, and that local regulations would suffice for specific choices of where to put towers. The FCC suggests that NEPA still applies to wireless licenses that are site-specific.

The NPRM also asks what rules should apply for the location of satellite earth stations, which are currently not specifically covered by regulation. The NPRM asks if the FCC should continue to ask tower owners to register with the FCC. The NPRM also asks if there should be any environmental regulations that apply in space –  a fitting question for the ever-more crowded low-orbit paths.