BEAD: Broadband or Boondoggle?

The Broadband Equity, Access, and Deployment (BEAD) Program is a once-in-a-generation investment that allocates $42.5 billion to high-speed internet access under the Infrastructure Investment and Jobs Act (IIJA).

On June 26, the White House announced that BEAD funds would be divided among all U.S. states and territories, with each state receiving at least $107 million and each territory at least $27 million. States received formal notice of their allocations on June 30 and have 180 days to submit proposals on how their programs will “ensure this money is spent where it is most needed.”

This means that within weeks, entities will begin receiving dollars to build out networks. While this could certainly be a turning point for the digital divide, some concerns remain.  

Shortly after the IIJA passed, the National Telecommunications and Information Administration (NTIA) announced a Notice of Funding Opportunity (NOFO) that required states to opt in to BEAD and develop a program to distribute funds. Before deciding how much money each state would receive, the NTIA coordinated with the Federal Communications Commission (FCC) to ensure its newly developed broadband maps gave a complete and accurate picture of unserved and underserved regions.

However, as an example, the District of Columbia has been granted $100,694,786.93—a substantial amount for a city that covers only about 64 square miles. While the FCC’s broadband maps show Washington, D.C. as 100 percent covered, the District’s director of state broadband and digital equity believes tens of thousands of residents lack internet access at home due to high costs.

BEAD dollars may be used to address this; however, the program’s key focus is infrastructure deployment. With other programs like Lifeline and the Affordable Connectivity Program already addressing affordability and adoption, what is being done to avoid duplicative funding? D.C. has not released its broadband plan yet, so it is unclear how this money will be spent. But stakeholder concerns regarding the BEAD Program’s efficacy must be addressed.

President Joe Biden has tried to assuage these concerns, stating that BEAD funding “will be used to deploy or upgrade broadband networks to ensure that everyone has access to reliable, affordable, high-speed Internet service.” Once these goals are met, “any remaining funding can be used to pursue eligible access-, adoption-, and equity-related uses.”

This gives the impression that funds could be used to overbuild or subsidize competition in markets already served by broadband providers. With so much money on the line, it is troubling to think how easily this program could be abused—especially in an area like D.C., where broadband coverage is already universal and there is little need to build out new coverage.

R Street published a blog post last June outlining concerns with the NTIA’s requirements for participation in the BEAD Program, as outlined in the NOFO: the creation of a “middle-class” affordability plan, the prioritization of government-owned networks and the implementation of net neutrality policies. Frustratingly, though House Republicans have raised the same concerns and increased oversight to ensure investments are made “in a technology-neutral way that avoids overbuilding and other wasteful spending,” nothing has changed.

The BEAD Program is touted as a once-in-a-generation investment in broadband that will finally end the digital divide and ensure internet access for every American. However, with billions of taxpayer dollars about to be disseminated, it is concerning that the NTIA still relies on a NOFO that creates barriers to deployment and fosters policies that will drive up costs and delay critical infrastructure buildouts.

The NTIA has not addressed legitimate concerns raised by stakeholders, nor has it done enough to ensure that BEAD dollars are used to create new networks where they are truly needed. The program could be a turning point for federal broadband investment—but if dollars continue to be spent improperly while entire communities remain unserved, it will share the fate of previous programs plagued by waste, overbuilding and connections to nowhere.