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How NTIA can best leverage its infrastructure bill programs to close the Digital Divide

Connected Nation makes recommendations to NTIA to maximize unprecedented federal investment in broadband expansion

Washington, DC (February 9, 2022) – With the passage of the Infrastructure Investment and Jobs Act (IIJA)—also known as the “Infrastructure Bill”—last  November, Congress charged the National Telecommunications and Information Administration (NTIA) with playing the leading role in closing America’s “Digital Divide” through partnerships with the states. Specifically, the bill charged NTIA with distributing more than $48 billion in broadband-related funding through several programs to be administered by its new Office of Internet Connectivity and Growth. With such an unprecedented investment, the opportunities to achieve universal broadband access—and foster a more robust, equitable broadband ecosystem for all Americans—have never been greater, but the stakes have also never been higher.

The key IIJA programs that NTIA will administer include the Broadband Expansion, Access and Deployment (BEAD) program, which will provide $42.45 billion through state broadband offices to construct, primarily, “last-mile” broadband infrastructure to unserved and underserved homes and businesses. The Digital Equity Act (DEA) language, which was rolled into the IIJA, will address the human aspect of the Digital Divide by awarding $2.75 billion in grants, of which $1.5 billion will go to states for creating and implementing Digital Equity Plans, and $1.25 billion will be spent on competitive grants to organizations with plans to teach digital literacy and otherwise foster digital inclusion. A further $1 billion for “middle-mile” broadband infrastructure grants will also be an NTIA program.

On January 10, NTIA posted a notice requesting public comment in an effort to allow “interested parties to provide vital input and recommendations for consideration in the development of [its] broadband programs.”  The notice sought responses to 36 multi-part questions, which NTIA will use to develop Notices of Funding Opportunity (NOFOs) for each of its new grant programs later this spring.  These NOFOs will define the parameters for each program, including allowable expenses and the processes states must follow to access and distribute the funding.

On February 4, Connected Nation (CN), along with more than 780 other commenters, submitted feedback and recommendations to NTIA in an effort to help the agency maximize this once-in-a-generation investment.

In the coming months, NTIA will be required to make a number of fast, smart decisions as it rolls out its programs, and that will be followed by years of diligent, skillful administration to ensure that the programs actually fulfill their promise.  CN believes that NTIA, the FCC, and the states should seek to define—and then actualize—a standard of universal broadband access that leans into the future by:

  • establishing metrics for robust symmetrical bandwidth to all homes and businesses;
  • fostering a more competitive and resilient broadband landscape by supporting the development of open-access middle-mile infrastructure to and among rural and underserved communities;
  • prioritizing latency and cost reductions through local network interconnection and the movement of cloud services and content to the network edge; and
  • promoting program transparency and accountability.

Connected Nation’s Recommendations

For more than 20 years, CN has been working at the intersection of technology and telecom policy to promote broadband access and digital equity for all Americans. As a mission-driven nonprofit, CN aims to provide unbiased, experienced-based guidance to ensure that federal and state programs are maximized. CN believes that unserved communities—and, ultimately, the taxpayers who fund these programs—deserve a significant return and impact.

“We are fond of saying that ‘everyone belongs in a Connected Nation,’” said Tom Ferree, Chairman & CEO, CN. “That’s not just lip service; the notion of inclusiveness informs everything we do. We are always striving to think about new ways in which we can help expand access, drive competition, and improve digital equity. The IIJA’s broadband programs provide an unprecedented opportunity to advance our mission. We stand ready to support NTIA and the state broadband offices to bring about a more connected nation for everyone.”

It is in this spirit that CN offers its recommendations, which are summarized in greater detail below.

Leverage the strengths of federalism. Congress has, through the IIJA, empowered states to play their historical role as “laboratories of democracy”—or in this case, “laboratories of broadband innovation.” CN believes that NTIA should give states latitude to set priorities and experiment, while using feedback and negotiation to keep states on track towards the goal of universal broadband access. NTIA should be generous in providing education and training to state broadband offices, including the provision of feedback on existing state broadband grant programs (of which there are many) in order to help them become compliant for BEAD Program funding.  However, CN also believes that NTIA should be careful not to let technical assistance crowd out capacity building. States will ultimately prove they are ready to run BEAD-compliant broadband grant programs by authoring the plans and rules for BEAD-compliant programs.

Inform and mobilize. NTIA cannot leave local stakeholder engagement only to the states. It needs to make a vigorous effort to connect with grassroots organizations, local governments, service providers, and the general public—informing them about IIJA programs and encouraging and empowering them to participate in state policymaking processes and program implementation. CN believes the federalist approach that Congress embraced in the IIJA, with state governments receiving and allocating most of the money, has great potential but also involves risks. Few states are fully prepared for the challenge, and an engaged citizenry and civil society are necessary if BEAD and DEA funds are to be spent competently and in the public interest. And, as it mobilizes stakeholders, we believe NTIA should ensure that states themselves stand ready to listen to, and incorporate, stakeholder input as they design and implement BEAD and DEA programs.

Transparency and due process. While NTIA should allow states wide latitude to set priorities and design processes, it is crucial that those processes should be highly transparent to the public. CN believes that NTIA should use its oversight role to ensure this. The public needs to know in advance how much money is available for what purposes, what areas are to be targeted, and how decisions will be made to allocate funds. Stakeholders need transparency so they can effectively engage. As awards are made, the public should know not only who, and for what, but also why a project is warranted and how the decisions were made. NTIA should diligently verify that award decisions are made in a manner consistent with pre-announced processes and criteria, and even make states revoke awards that are made improperly.

NTIA should also monitor the formats in which information is published and ensure that it’s convenient for concerned citizens and watchdog groups to use. And after projects are complete, it should be easy for citizens to find out just what broadband access options have been secured for them through IIJA programs, and to hold awardee ISPs accountable if they have failed to fulfill their promises.

Complementarity and the broadband funding landscape. One of the trickiest parts of implementing the BEAD program will be to work around and supplement existing federal and state broadband grants, especially RDOF. The NTIA should strive to avoid both (a) letting areas be excluded from BEAD eligibility by existing projects which then fail, and (b) causing the failure of existing RDOF projects that would otherwise have succeeded by introducing new subsidized competitors.

In the case of programs other than RDOF, we advise the NTIA to follow its own precedent under the Coronavirus Capital Projects Fund (CCPF) by requiring that new funding (a) not doubly reimburse any costs, and (b) achieve additional public interest goals, e.g., in terms of timeline or performance. But RDOF’s success in securing ambitious promises for relatively little support make it a case apart. The need there is not so much to improve the planned networks as to make sure the builds get done. Yet this must be done without rewarding bidding behavior that may in some cases have been irresponsible overpromising. General cost escalation can both justify and limit some additional support to RDOF winners that are on track to succeed. Coordination with the FCC would be essential in those cases.

Prioritizing digital equity. For more than two decades, CN has led state and local programs that focus on achieving digital equity and inclusion. While that is no easy task to achieve, CN believes that digital equity can be thought of as a “ladder” with five steps:

  1. Access. A broadband connection must be available, with adequate bandwidth, performance, and reliability.
  2. Adoption. People must be able to subscribe to broadband services to realize its benefits. This includes providing access to affordable broadband services for covered populations as stated in the Digital Equity Act, via the Affordable Connectivity Program, Lifeline, and other ISP low-cost programs.
  3. Devices. People must possess internet-capable devices, including computers. Smartphones are helpful, but "screen size matters" when it comes to some uses.
  4. Basic skills and digital literacy. It takes a bit of “know-how” to use the internet effectively.
  5. Digital upskilling. It takes significantly more skill to make full use of what the internet has to offer in the areas of education, healthcare, career development, personal finance, entrepreneurship, and self-realization and discovery.

While the BEAD Program is intended to tackle the ladder’s first step, CN believes that states should be given flexibility in defining allowable expenses under the BEAD Program to include broadband adoption programs and even the provision of devices in some cases. CN also believes that DEA grantmaking should serve as an incubator for social entrepreneurs in the digital equity space, encouraging innovation and forward momentum. Rather than defining specific goals, the DEA will work best by enabling mission-driven organizations to help the digitally disadvantaged in diverse, creative ways that may merit emulation, without prescribing detailed forms of accountability—while still aligning to one or more steps in the ladder.

NTIA should look for opportunities to facilitate productive collaboration between expert specialists in aspects of digital equity that have national reach—many of which may qualify for the DEA competitive grants, and states that are trying to figure out what digital equity should mean for them and how they can advance it.

Make impactful middle-mile investments that prepare communities for the future of the internet. The IIJA devotes some, though insufficient, resources to building middle-mile capacity through the Middle Mile Broadband Infrastructure (MMBI) grant program. CN believes that the BEAD Program be interpreted to allow its funding to support more middle mile investment in ways that directly support last-mile projects.

NTIA should also be intentional about maximizing the impact of the IIJA programs to shape a more robust, competitive, and resilient middle-mile connectivity landscape across the U.S. NTIA should empower states to seek ways to avert inefficient local monopolization of the backhaul business, in favor of local carrier-neutral interconnection points and backhaul availability on an open, transparent, and nondiscriminatory basis. Specifically, NTIA should prioritize projects that enable the construction of carrier-neutral Internet Exchange Points (IXPs) that will have the effect of reducing latency, bringing cloud and content delivery closer to the network edge, keeping local traffic local, and serving as a marketplace for backhaul and IP transit competition, while also supporting the development of open-access dark fiber networks to and among rural communities.

CN believes that the lack of local real estate to facilitate network interconnection—on a level playing field across all network operator types—is a major reason why there is a lack of competition in smaller markets. That is why Congress prioritized network interconnection—and by extension, the construction of IXPs—in the MMBI Program. The existence of these facilities is arguably more important than middle-mile fiber construction itself, because all local networks must have a physical place to interconnect on a neutral and open basis with competitive middle-mile networks. Otherwise, the utility of those networks is severely limited, and borders on being a waste of resources.

The incumbent’s central office is inherently not neutral, so the lack of a neutral facility is a preeminent concern to the success of the middle-mile grant program. CN therefore believes that NTIA should require all network operators that receive a grant for middle-mile network construction to terminate locally in an independent carrier-neutral facility. Where no such facility exists, NTIA should fund the construction of one.

Look upstream toward supply chain challenges. Even before the IIJA dramatically escalated anticipated funding, there were supply chain problems in obtaining supplies, equipment, and labor for the deployment of broadband infrastructure. It’s important that the NTIA closely monitor the supply side, including workforce, fiber, and equipment to foresee bottlenecks and look for opportunities to intervene in collaboration with the White House.  CN anticipates that that IIJA program implementation will only exacerbate current supply-side problems.

Connected Nation’s complete set of recommendations to NTIA can be accessed here.

Everyone belongs in a Connected Nation.