Process for Federal Internet Infrastructure & Digital Equity Fund Distribution Begins

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State Deadlines Are in Mid-July; Localities Should Start Consulting With Their States Now

The Department of Commerce’s National Telecommunications and Information Agency (NTIA) recently released Notices of Funding Opportunity for several programs adopted as part of the 2021 Infrastructure Investment and Jobs Act (IIJA). Although the funding is primarily directed toward states and territories, localities should start working cooperatively with states right away with respect to two key programs:

  • Broadband Equity, Access, and Deployment (BEAD) Program: $42 billion in funds allocated for planning for and deploying or upgrading broadband internet, installations in multi-tenant environments, implementing adoption, digital equity, workforce and job training programs
  • Digital Equity Act Program: $2.75 billion in funds allocated for digital equity and digital inclusion activities that will ensure that all individuals in the United States have access to, and the use of, affordable information and communication technologies and the skills to use them

Localities should engage in their state processes to ensure local broadband needs are met and prepare for their special role in reviewing state plans as the BEAD process moves forward.

Summer Deadlines
States must file a complete application for the Digital Equity planning grant by July 12 and a letter of intent to participate in BEAD to draw on the initial $5 million in planning funds by July 18. BEAD applications for initial planning funds are due on Aug. 15. Additional deadlines for BEAD will be issued once the Federal Communications Commission (FCC) completes its broadband maps. If a state or territory fails to submit a letter of intent, initial proposal or final proposal in any stage of the BEAD program, NTIA will issue a notice to permit a political subdivision or consortium of political subdivisions to submit the application in its place.

Planning First
Both programs include planning grants followed by implementation grants. BEAD allocates $5 million of initial planning funds; five-year plans must be complete within 270 days of receipt of planning funds. The Digital Equity Act allocates $60 million to develop digital equity plans, which are the first step in the larger State Digital Equity Capacity Grant Program. A state must develop, solicit and respond to public comments on the draft equity plan, and finalize that plan within one year.

NTIA is encouraging states to engage in both planning processes at the same time; BEAD plans must take digital equity factors into account. To create their equity plans, states must consult with a long list of stakeholders, such as members of racial or ethnic minority groups, veterans and individuals who are at or below 150% of the poverty line, aging, incarcerated, face a language barrier or have disabilities. NTIA must approve planning funds for each program, but they are expected to begin disbursement in late September 2022.

BEAD Process
Each state will receive a minimum of $100 million in BEAD funds. The remaining funds will be allocated using a formula based on the BEAD program goals, including a primary focus on unserved areas (broadband below 25/3 Mbps) and a secondary focus on underserved areas (broadband below 100/20 Mbps). That determination will be based on forthcoming maps created by the FCC. Therefore, a Notice of Available Amounts will be issued on or after the FCC develops its broadband maps; state initial proposals are due 180 days afterward. Once state initial proposals are submitted, a unit of local government, nonprofit organization or broadband service provider may challenge the initial plan, including whether a location is eligible because it is unserved or underserved. Next, the state will select sub-grantees. Once NTIA approves an initial proposal, at least 20% of a state’s funds will be released. The state will then have one year from approval of its initial proposal to finalize its plan, receive final approval and obtain its remaining funds. A four-year implementation period follows.

Forthcoming Digital Equity Grant Programs
Two programs will be the subject of notices of funding opportunity in the future:

  • The Digital Equity Capacity Grant Program, which will offer $1.44 billion for a five-year annual grant program to implement digital equity plans.
  • The Digital Equity Competitive Grant Program, which is a $1.25 billion five-year annual grant program for digital equity projects that will be available to local governments, foundations, nonprofits, educational agencies workforce development programs and community anchor institutions.

Localities may also still take advantage of existing broadband programs outside of the new NTIA-run programs:

  • Affordable Broadband: The new Affordable Connectivity Program (ACP) provides low-income individuals and households with a $30 monthly subsidy ($75 in tribal areas) for high-speed broadband. Localities should ensure their communities know about ACP. The White House announced that many major providers are offering $30 monthly programs at very high speeds. For more information, visit getinternet.gov.
  • ARPA Funds: As BB&K detailed at the beginning of this year, the U.S. Department of Treasury’s Final Rule governing implementation of the American Rescue Plan Act (ARPA) Coronavirus State and Local Fiscal Recovery Funds granted localities significantly more flexibility to use those funds for broadband infrastructure, including investments to address access, affordability and reliability.

Resources
This high-level summary is not a substitute for reviewing the materials in-depth. Do not hesitate to contact BB&K if we can be of assistance in understanding these programs in more detail.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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