Now that the fight over federal funding to expand broadband access has been largely settled with the passage of the American Rescue Plan Act (ARPA) and the Infrastructure Investment and Jobs Act (IIJA), states and local communities are preparing to put those funds to work.

The Biden Administration had initially hoped to tip the scales in favor of building publicly-owned broadband networks as the best way to boost local (more affordable) Internet choice, and inject competition into a market dominated by monopoly incumbents. And while the Treasury rules on how Rescue Plan money can be spent does give states and local governments the ability to do just that, the rules for how the IIJA’s Broadband Equity, Access, and Deployment (BEAD) program can be spent have yet to be finalized by the National Telecommunications and Information Administration (NTIA), the agency in charge of allocating those funds to the states.

Predictably, the big monopoly incumbents are focusing their lobbying efforts on state lawmakers as states funnel those federal funds into state broadband grant programs. In some states, Big Telco is getting the desired result: the shunning of publicly-owned network proposals to shield monopoly providers from competition. Of course, we expected some states – especially those with preemption laws that either erect barriers to municipal broadband or outright ban such networks – to shovel most of their federal broadband funds to the big incumbents, even though they have a long track record of over-promising and under-delivering. 

But while we might expect Florida and Texas to favor the private sector and stealthily move to shut out projects that are publicly-owned, we’re surprised that the first place it’s happening is actually Illinois and New York.

Illinois Lawmakers Thumb Nose at Federal Law

Decatur, Illinois (pop. 71,000) is moving forward with an Institutional Network (I-Net) expansion that will connect 11 school districts and 3 firehouses to its growing fiber-optic backbone, connecting potential commercial and industry customers along the way. 

The city of Decatur has been expanding its fiber network since 2014, when it decided to deploy a backbone network connecting several of its facilities. This most recent expansion will extend the access to Franklin and Parsons schools, Stephen Decatur Middle School, Eisenhower and MacArthur high schools, American Dreamer STEM Academy, Dennis Lab School, Hope Academy, Johns Hill Magnet School and William Harris Learning Academy.

The expansion is the result of a 5-0 city council vote in April approving a $915,000 contract with Bodine Electric to purchase and hang 144 strand fiber-optic cable. 

A portion of the funding for the contract will come from a $800,000 grant from the Connect Illinois grant program, an initiative aimed at expanding broadband access. The program launched in 2019 with $420-million investment in broadband infrastructure. The first round of grants totaled $50 million with a combined $9.25 million going to monopoly ISPs CenturyLink, MediaCom, Spectrum, and Comcast and the rest going to local ISPs and city and county governments. 

The remaining $115,000 allocated in the contract will come from the state’s portion of the American Rescue Plan fund. 

While the city will fund the expansion of the backbone to pass by the schools and connect the firehouses, Decatur Public Schools (DPS) will also contribute $600,000 to connect the schools to the street fiber. The contribution is also from the Connect Illinois Grant Program.  

When the state grants came through, the city and DPS saw an opportunity to collaborate. 

Less than six months after its creation and a year after the city of Waukegan, Illinois (pop. 89,000) began exploring options to improve connectivity in response to the Covid-19 pandemic, a Request for Proposals (RFP) has been issued by the Waukegan Broadband Task Force in search of qualified applicants to assist in the creation of a broadband master plan. Applications are due June 30th, 2021.

Waukegan is situated about halfway between Chicago and Milwaukee, along the west coast of Lake Michigan. A 2020 initial broadband assessment showed challenges related to price, devices, digital skills for remote learning, and a lack of coordination to get income-qualified residents onto incumbent ISP's low-income plans. The city is served by a patchwork of ISPs, including cable from Comcast, DSL from AT&T and TDS, and fixed wireless from Rise Broadband with starting prices on plans ranging from $30/month to $60/month.

The Task Force website outlines the group's goals and stakes for the community:

There are few cities with the opportunities that exist within Waukegan. However, to truly become a ‘City of Progress’ , Waukegan must take the critical steps necessary to achieve its great potential. While 2020 brought challenges to communities around the globe, it also presented opportunities for innovation, collaboration, change and growth. The Waukegan Community Broadband Taskforce is an open, collective impact inititative of committed community stakeholders for all residents, businesses, institutions interested in working together to create a path to the future.

The RFP calls for solutions addressing access, adoption and utilization, sustainable funding, and communication and community engagement with a particular focus on remote learning, telehealth, and economic development.

The steering committee for the task force is made up of a collection of local nonprofits, the public library, the community center, city officials, and the school district. Funding for the master plan will come from private contributions.

Applicants can direct questions to wbctaskforce@gmail.com by 5pm on June 6th, with full RFPs due by June 30th.

In a part of the Prairie State referred to as “Little Egypt,” a small county in southeastern Illinois recently received a big infusion of federal funds to expand its broadband network into neighboring rural counties. 

In October of 2020, the USDA announced that the Hamilton County Telephone Cooperative was awarded a $20 million ReConnect grant and a $20 million ReConnect loan to bring broadband to over 19,000 residents, 462 businesses, 347 farms, 16 educational facilities, three post offices and four fire stations in Saline, Williamson, Franklin and White counties.

The $40 million in total Hamilton County received was a portion of the $600 million Congress appropriated to the USDA in 2018 to expand broadband infrastructure and services in rural America. In April of 2020, the USDA announced it had received 172 applications worth $1.57 billion in Round Two ReConnect requests. 

The funds awarded to Hamilton County in the fall came on top of the $3.4 million from the state-wide Connect Illinois program and ReConnect funds the co-op received in February of 2020 to build out its Fiber-To-The-Premises (FTTP) network to connect more than 600 homes in the rural county with a population just over 8,000 residents.

Decades of Service

All across the country, municipal networks, cooperatives, and cities have been putting in extra effort to make sure that Americans have the fast, affordable, reliable Internet access they need to conduct their lives in the midst of the COVID-19 pandemic. 

AT&T has decided to take another route. A USA Today report last week revealed that the company has stopped making connections to users subscribing to its ADSL Internet as of October 1st. Anyone calling the company to set up new service is being told that no new accounts are being accepted. 

The decision comes right as the National Digital Inclusion Alliance has released a report detailing that only 28% of AT&T’s territory can get fiber from the company. AT&T has deliberately focused investment in more urban areas of higher income. From the report:

The analysis of AT&T’s network reveals that the company is prioritizing network upgrades to wealthier areas, and leaving lower income communities with outdated technologies. Across the country, the median income for households with fiber available is 34 percent higher than in areas with DSL only — $60,969 compared to $45,500. 

The Deep South Hit Hardest

As of today, it looks like the most conservative number of those affected by the decision will be about 80,000 households that have no other option. Our analysis using the Federal Communication Commission’s (FCC) Form 477 data shows that the Deep South will be hit the hardest (see table at the bottom of the page). 

Collectively it means more than 207,000 Americans who, if disconnected, will have no option for Internet aside from their mobile devices or satellite service. The number of Americans affected by the decision but which have additional wireline options is higher: roughly 2.2 million American households nationwide subscribe to the service (see map, below).  

When school shut down past spring, Unit 4 schools in Champaign, Illinois scrambled to get students connected like everyone else. The district handed out Chromebooks and teachers went to work transitioning to online instruction so the school year could continue. But the district noticed that a large percentage of its students weren't logging on and the bulk of them came from Shadowwood mobile home park, where although fiber ran up and down every street in the neighborhood only one family subscribed to wireline Internet access. So Mark Toalson, the city’s IT Director, began making calls, and by the end of the summer a coalition came together to build Shadowwood’s students a free fixed wireless network which went online in August.

Fiber Just a Few Feet Away

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The mobile home park sits on the north side of the town of 90,000, and is largely populated by Hispanic residents. Roughly 250 students who attend the Unit 4 school district live there, and according to Toalson not a single one had Internet access beyond personal mobile phones before they began last spring. In late May Mayor Deborah Feinen asked the city manager what could be done, and Toalson was asked to take on the project. 

A year ago we wrote about Illinois’ $420 million commitment to broadband expansion, and now the first round of grant winners has been released. Together they total $50 million in state funds matched by $65 million in additional money for 28 projects by 18 different Internet Service Providers (ISPs) that will, ultimately, connect 26,000 homes, farms, community institutions, and businesses in the state. It represents the first milestone in what is a significant commitment to closing Illinois' broadband gap.

Lots of Winners, Some Caveats

The Broadband Grant Program offers applicants up to $5 million in funding for projects with the stipulation that they match it with an equal or greater amount of other, nonstate funds. First-round winners consist of both middle- and last-mile builds touching at least 27 counties throughout the state. For example, Cook County received a little under $2 million to expand its Chicago Southland Fiber Network (CSFN). CSFN provides backhaul services to many, including the Illinois Century Network — which serves over 3,400 public K-12 schools, universities, and libraries. Their application committed to focusing “on fiber paths that will provide distribution and host last mile service platforms addressing those communities with the greatest need, municipalities with no fiber assets . . and key regional education campus facilities.” 

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Last week, Frontier Communications told the Federal Communications Commission (FCC) that there are 17,000 census blocks in which it is now offering 25 Megabits per second (Mbps) download and 3 Mbps upload. This means well over 400,000 Americans now live in areas no longer eligible for the FCC's Rural Digital Opportunity Fund, a $20.4 billion program to expand rural broadband. The first phase will auction off up to $16 billion in subsidies later this year.

In the filing, the company also identified census blocks where it believes other providers will deploy broadband access through state-funded programs, making those locations ineligible for the federal funds as well.

Frontier is Flailing