States: BEAD Unlikely to Bring Fiber Everywhere

Texas wasn’t surprised to get $3.3 billion for its BEAD allocation, but Comptroller Glenn Hegar (R) says it will take $10 billion to connect everyone, said Texas Broadband Development Office Outreach Coordinator Andrea Pacheco. She noted Texas voters will consider a ballot initiative in November on having the state put in another $1.5 billion (see 2305300057). That amount plus Capital Projects Fund money could get the state closer to finishing the job, she said.

Idaho’s $583.3 million allocation was in the middle of the state's expected range, said Ramon Hobdey-Sanchez, the Idaho Commerce Department’s state broadband program manager. “We were tickled just to get that amount.” But Idaho estimates it will take more than $1 billion to connect the state’s about 113,000 unserved and underserved locations to underground fiber, Hobdey-Sanchez said. It may be possible to save money by hanging fiber or by using fixed wireless or low-orbit satellites, he said.

Arizona’s $993 million isn’t enough to cover everyone with fiber, said Arizona Commerce Authority State Broadband Director Sandip Bhowmick. He expects the state will have a 70-to-30 split between fiber and wireless or other alternative technologies. “Fiber would be great,” said Bhowmick, but the state’s commitment to NTIA is to connect every household to reliable broadband. More private investment could make more fiber possible, he noted.

Minnesota’s $652 million is “not going to be enough,” said Minnesota Office of Broadband Development Executive Director Bree Maki on a panel later Wednesday. It’s about what the office expected, but the allocation is based on a 25 Mbps download and 3 Mbps upload definition of unserved, whereas Minnesota uses a 100/20 Mbps standard, she said. New Mexico’s $675.4 million allocation won’t be enough to connect everyone, either, and the state also faces a middle-mile gap, said Connect New Mexico Council member Ovidiu Viorica, broadband manager for the Public Schools Facilities Authority.

Virginia can close its digital divide with its $1.48 billion allocation, said Virginia broadband office Director Tamarah Holmes. The state expects to have leftover money for broadband adoption and affordability efforts, she said.

The $3.3 billion coming to Texas is a breathtaking amount for a broadband office that “feels very much like a startup” and is “still refining our processes,” said Pacheco. The nearly 2-year-old office has eight full-time employees and may add 18 more positions next month, she said. “The task feels very much overwhelming at times.” Idaho has many fewer people, noted Hobdey-Sanchez: “Idaho is still rocking a broadband office of one,” though it works with consultants and has one job opening.

One big challenge for Texas is that the most disconnected communities have the least resources to ensure projects will be funded in their communities, said Pacheco. Also “problematic” is a new Texas law that requires the office to prioritize applications from ISPs over public-private partnerships. “We’re looking to NTIA for guidance on how to address this.” Workforce development is a big challenge for Idaho, said Hobdey-Sanchez. Arizona challenges include permitting and avoiding overlap among various federal funding sources, said Bhowmick.

Right-of-way issues including permitting and pole attachments are costly and take much time, warned Viorica on a Tuesday panel. "This alone can bring the entire BEAD program to a stop.”

“It’s never too expensive” to connect people to fiber, Fiber Broadband Association CEO Gary Bolton said in a keynote earlier Wednesday. No home or business is not important enough to get it, he said. Benefits of investing in high-speed connections include reducing mass incarceration, lowering highway costs and enabling healthcare access, he said.

“Everyone has a right to this,” agreed Smart Connections Consulting co-founder William Pugh on another panel. Big ISPs have "more than enough equity" to help solve the problem, he said. Panelists agreed a mix of network technologies will be needed. Wireless must be considered for the highest cost places, said Mountain Connect CEO Jeff Gavlinski.

Mountain Connect Notebook

Additional affordable connectivity program funding would "put a Band-Aid on" the subsidy program's expected running out of funds next year, but a longer-term solution needs to come from an FCC overhaul of its USF, said American Association for Public Broadband Chairwoman Angela Bennink Wednesday at a Broadband Breakfast panel livestreamed from Mountain Connect in Denver. She said a USF overhaul, though, would take time, and states might need to cover costs in the interim. A USF overhaul "has been the third rail" of telecom policy for years, but there should be discussion about it, said Christopher Ali, Pioneers Chair in Telecommunications at Penn State University. Inflation is whittling away at the spending power of the $42 billion allocated in BEAD, which is putting pressure on the goal of 100% access, said David Don, Comcast senior vice president-public policy. BEAD is pro fiber, but "everyone recognizes there's a role for fixed wireless," especially as states also want to stretch their BEAD funding to connect community anchors and provide digital equity, said Steve Schwerbel, Wireless ISP Association state advocacy manager. He said states are trying to be creative with financing options, like not requiring local matches to be project by project but potentially bundled across a broader area. Bennink said matching funds could be a challenge, particularly for smaller communities. Ali said states need to have safeguards in place to make sure those communities aren't shut out in favor of those with deeper pockets. He said philanthropic groups could assist in bridging that match gap.