BEAD: What can be, unburdened by what has been
On Nov. 15, 2021, President Joe Biden signed the Infrastructure Investment and Jobs Act (IIJA) into law. The IIJA included the $42.5 billion Broadband Equity, Access, and Deployment (BEAD) program, a once-in-a-generation investment in broadband. Shortly after the bill’s signing, the National Telecommunications and Information Administration (NTIA) announced a Notice of Funding Opportunity (NOFO) requiring states to opt into BEAD and setting operational guidelines for the program. On June 26, 2023, the White House announced the allocation plan for BEAD’s $42.5 billion investment: U.S. states would receive a minimum of $100 million per state and U.S. territories would get a minimum of $25 million per territory.
States received formal notice of their allocations on June 30 and had 180 days to submit initial proposals. Ostensibly, entities would start receiving dollars to build networks within weeks. But few states have had their plans approved to date, and not one state has commenced its buildout projects or started connecting its citizens to the internet.
R Street has covered this topic before, but as a quick refresher, the NOFO’s major issues included requiring a middle-class affordability plan, prioritizing government-owned networks, and enforcing net neutrality provisions. Despite Congressional intent, the NOFO included language and provisions that could jeopardize BEAD by unduly burdening grantees seeking to use these funds to build out broadband networks. On July 9, 2024, U.S. House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-Wash.), House Oversight and Investigations Subcommittee Chair Morgan Griffith (R-Va.), and House Communications and Technology Subcommittee Chair Bob Latta (R-Ohio) sent a letter to the NTIA requesting an explanation as to why the agency was “imposing onerous hurdles on state broadband agencies to receive [their] share of allocated broadband funding.”
In his July 9 remarks before the House Energy and Commerce Committee, Federal Communications Commission (FCC) Commissioner Brendan Carr highlighted that, in nearly 1,000 days, “not one person [in the entire United States] has been connected to the Internet with [BEAD] dollars—not one home, not one business… not even one shovel worth of dirt.” Commissioner Carr has routinely raised concerns about the NTIA’s regulatory red tape, which has transformed a program meant to close the digital divide into a perpetual jobs program that spends billions of dollars while doing nothing to connect Americans to the internet.
The NTIA can easily remove the more burdensome requirements created by the NOFO; instead, it has instituted waivers and exemptions that put additional responsibility on providers. For example, in August 2024, NTIA introduced a waiver for the BEAD program’s “Buy America” provisions that forced providers to use only American-made products, including fiber for BEAD-sponsored deployments. While well intended and potentially beneficial to American companies and workers, supply chain constraints and cost worked against the provision by hindering U.S. carriers’ participation. Recognizing the challenges the original provision incited, the NTIA opted to offer waivers rather than modify the requirement—further burdening the carriers by forcing them to spend time and money applying for the waivers and waiting for their resolution.
Providers also face layers of bureaucratic red tape around permitting and pole-attachment requirements, which can greatly delay deployments and/or drive up costs. Pole attachments, in particular, are a key factor in deployment costs, especially poles owned by municipalities or cooperatives. These poles are currently exempted from FCC pole attachment rules, which ensure that pole operators and attachers can coordinate effectively and efficiently on network deployment. As one study noted, the average pole attachment for such poles is twice the cost of an investor-owned pole. For a 5,000-pole project, this provision alone could add more than $40,000 in development costs. Congress could easily close this loophole by amending the Communications Act to create parity for poles. The NTIA should also incentivize local and municipal governments to ease rules for pole attachments and permit streamlined processes to make deployments easier and less expensive.
Amid growing frustration and disappointment, there is an opportunity to course-correct and ensure the BEAD program addresses the deployment challenges that make it impossible for carriers to successfully close the broadband access gap. Additionally, with a national election only about 90 days away, a new administration could be forced to make substantial changes to BEAD, which could lead to pauses and further delays to the expenditure of critical federal dollars. The NTIA must ensure the program’s longevity by building out a framework that will support the administrative transition and get federal dollars flowing to states and communities as soon as possible so that carriers can begin their deployments.
The BEAD program is touted as a once-in-a-generation investment that will finally end the digital divide and ensure broadband access for every American. However, with billions of taxpayer dollars about to flow through the states to deploy networks, the NTIA’s reliance on a NOFO that creates more problems than it solves is concerning. This could be a turning point for federal broadband investment, but as things currently stand, history is only repeating itself. Federal dollars continue to be spent, yet communities remain underserved. Despite the $42.5 billion investment in the BEAD program, there is no clear timeline for Americans to begin reaping its benefits.