The Coronavirus Aid, Relief, and Economic Security (CARES) Act and the American Rescue Plan Act (ARPA) provided the state of Wisconsin with more than $4.5 billion in federal COVID-19 “relief” funds.  A September 2022 Wisconsin Legislative Audit Bureau report details how the state’s Public Service Commission (PSC) allocated $105.6 million of that funding for broadband expansion with limited guidance and oversight, opening the door to waste, fraud, and abuse.

The PSC allocated $6.2 million in CARES Act funding in October 2020, “to establish a broadband grant program to address the need for distance learning and telework” due to the pandemic and another $99.4 million from ARPA “to administer a grant program to build broadband infrastructure in unserved and underserved areas of the state.”  The PCS distributed 12 grants for fixed wireless and fiber-optic projects paid for by CARES Act funds and 83 grants to 36 providers for fiber-optic projects using ARPA funds.

The 12 projects funded by CARES Act grants “made new or improved service available to 20,535 business and residences.”  But the PSC neglected to provide written policies for the administration of funds, and grant recipients failed to indicate how much was spent to complete the broadband projects.  The PSC also failed to thoroughly vet applicants for the grants.  Of the 12 applicants for CARES Act grants, six listed a portion of the proposed build out speeds required by the application, five failed to list any build out speeds, and one applicant provided all of the required build out speeds.

As with the CARES Act projects, the PSC failed to properly oversee for the expenditure of the ARPA funds.  The PSC, the report states, failed to “establish comprehensive written program policies for administering the funds” and did not “consistently adhere to its grant application instructions when deciding which projects to fund.”

The bureau’s report concluded with a series of recommendations to allow for greater oversight and better management of future grant programs, including the distribution of funds under the Infrastructure Investment and Jobs Act (IIJA).  First, the PSC should provide written policies detailing the administration of broadband grant policies.  Second, the PSC should establish consistency in instructions, maintain records, and specify reasons for selecting or not selecting applicants.  Third, the PSC should provide reimbursements only after receiving documents showing that they had paid for projects.  Finally, the PSC should “document its efforts to verify that telecommunication providers had constructed the broadband infrastructure for which they were reimbursed.”

The Legislative Audit Bureau’s analysis of broadband funding from the CARES Act and ARPA uncovered a disturbing lack of accountability and oversight from the PSC.  The state will be receiving more funding for broadband expansion through the IIJA, which makes it imperative for the bureau’s recommendations to be implemented promptly to avoid misspending more taxpayer dollars on inefficient or ineffective broadband projects.