Federal Funds for Broadband Must Not Be Wasted | Citizens Against Government Waste

Federal Funds for Broadband Must Not Be Wasted

The WasteWatcher

There is an unprecedented amount of federal money now available for broadband deployment across the country through various government agencies.  According to Federal Communications Commission (FCC) Commissioner Brendan Carr, during a Facebook Live interview on February 1, 2022 with Citizens Against Government Waste (CAGW) President Tom Schatz, the total is as much as $800 billion.  Commissioner Carr noted that about $80 billion is needed to connect everyone across the country who is unserved.  With 10 times more than should be necessary, he said there is little doubt that groups like CAGW will be very busy trying to keep track of potentially wasteful spending.

Much of the money being made available has emanated from the coronavirus relief packages, like the CARES Act and the American Rescue Plan Act.  On November 15, 2021, H.R. 3684, the Infrastructure Investment and Jobs Act of 2021 (IIJA), which allocated $65 billion toward broadband infrastructure, became law.  And all of these bills were on top of the tens of billions of dollars that were already being allocated by the FCC.

Unfortunately, there is inconsistent guidance across federal agencies (other than the FCC) for using these funds, including different standards for speed thresholds and preferences for specific vendors and technology.  For example, in October 2021, the Rural Utilities Service issued its Notice of Funding Availability (NOFA) evaluation criteria for Round 3 of the Rural eConnectivity Program (ReConnect), which included preferences for governmental or quasi-governmental entities and entities who agree to unrelated policy requirements like net neutrality.  In January 2022, the Department of Treasury issued its guidance for states and local governments on the $350 billion allocated for infrastructure improvements from the American Rescue Plan Act, which set preferences for fiber and either government-owned or nonprofit broadband networks. 

The National Telecommunications and Information Administration is currently considering the parameters for the $42.45 billion in funding the agency received in the IIJA.  Stringent oversight is needed to avoid waste, fraud and abuse that occurred in prior broadband funding initiatives, particularly the 2009 stimulus programwhich allocated more than $7.2 billion for broadband.  NTIA received $4.7 billion of that amount, just over 10 percent of the $42.45 billion it will now be able to spend.

On February 4, 2022, CAGW submitted comments to the NTIA urging the agency to avoid imposing preferences for government-owned networks when providing funding to grant applicants.  The recommendation is consistent with CAGW’s longstanding position on broadband funding, including the May 2021 issue brief, “The Folly of Government-Owned Networks,” which emphasized that government programs avoid setting a preference for government-owned networks, and instead encourage federal, state, and local governments to enact laws and regulations that are vendor and technology neutral, and reduce regulatory barriers that will help provide incentives for increased broadband deployment in unserved and underserved communities.

CAGW recommended that the NTIA grants be issued in a technology and vendor neutral manner and that grant recipients should construct broadband networks first to unserved communities that do not meet the current broadband standard of 25/3 Mbps speed thresholds, including historically disconnected communities where middle and last mile connectivity is lacking, and then after these communities are served, underserved communities that have only one provider offering 25/3 Mbps. 

NTIA must work with other federal agencies that administer funding for broadband deployment, including the Departments of Agriculture and Treasury, and the FCC to ensure that taxpayer resources are not being wasted by be directed to the same projects, or areas that are already being served by either existing grant programs, or from private sector initiatives.  Therefore, the FCC must complete its new broadband mapping project as quickly and accurately as possible. 

There appears to be more than enough money to connect everyone in the country who wants access to the internet.  To ensure there is no duplication of effort or overlap of existing networks using taxpayer resources, and broadband dollars are maximized to its fully potential use, state and local governments and other stakeholders, like current providers and the taxpayers who are ultimately footing the bill for this massive spending, must be included in developing rules on NTIA grant proposals using the funding from IIJA.  Funding in other agencies must be watched very closely, since their criteria is much more likely to lead to overbuilding existing private-sector networks and failing to reach unserved communities.

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