With American Rescue Plan funds flowing into state government coffers, about a third of the nation’s 50 states have announced what portion of their Rescue Plan dollars are being devoted to expanding access to high-speed Internet connectivity.

The federal legislation included $350 billion for states to spend on water, sewer, and broadband infrastructure, though everything we have seen suggests that the vast majority of that will not go to broadband. There is also another $10 billion pot of rescue plan funds, called the Capital Projects Fund, that mostly must be used to expand access to broadband.

Laboratories of Broadband-ification 

As expected, each state is taking their own approach. California is making a gigantic investment in middle-mile infrastructure and support for local Internet solutions while Maryland is making one of the biggest investments in municipal broadband of any other state in the nation. And although Colorado does not prioritize community-driven initiatives, state lawmakers there have earmarked $20 million for Colorado’s two federally-recognized Indian tribes to deploy broadband infrastructure with another $15 million devoted to boosting telehealth services in the state.     

Undoubtedly, individual states’ funding priorities vary. Some states may be relying on previously allocated federal investments to boost broadband initiatives and/or have been persuaded the private sector alone will suffice in solving its connectivity challenges. And in some states, such as Illinois, Minnesota, and Maine, lawmakers have prioritized using state funds to support broadband expansion efforts while other states may be waiting on the infrastructure bill now making its way through Congress before making major broadband funding decisions.

As of this writing, 17 states have earmarked a portion of their Rescue Plan money (totaling about $7.6 billion) to address the digital divide within their borders. Those states are Arizona, Arkansas, California, Colorado, Delaware, Hawaii, Indiana, Kentucky, Maine, Maryland, Montana, Missouri, Virginia, Tennessee, Vermont, Washington, and Wisconsin.

ILSR’s Community Broadband Networks Initiative Director Christopher Mitchell recently joined Drew Clark, Editor and Publisher of Broadband Breakfast, for a live discussion centered on the “Investment Implications of a Federal Broadband Infrastructure Bill.”

During the discussion, Christopher breaks down the various pots of money the federal government has dedicated to expanding Internet infrastructure and access to date. He points to the shortcomings of current federal programs, among which are provisions that set aside funds in the American Rescue Plan Act (ARPA) for the Emergency Broadband Benefit and the Emergency Connectivity Fund going to short-term, incumbent-friendly solutions.

Christopher noted that while the Emergency Broadband Benefit has helped income eligible households by providing $50 to $75 a month subsidies for home Internet subscriptions, it leaves uncertain what the future holds for these communities when the funds run out. Similarly, he points to restrictions placed on the Emergency Connectivity Fund, which limit the ability of schools and libraries to use the funds to build their own networks. Throughout the discussion, Chris maintains that public dollars should be spent on more sustainable, long-term solutions. 

With $3.9 billion from the American Rescue Plan Act on its way to Maryland, Gov. Larry Hogan and state legislative leaders have agreed to seize the moment, allocating $300 million of federal COVID-19 relief funds to expand broadband infrastructure and digital inclusion initiatives across the state.

The biggest bulk of the money – $97 million – will go towards funding the building of physical infrastructure with $45 million earmarked specifically for municipal broadband grants.

“The question isn’t how much it’ll cost to bridge the digital divide, the question is how much will it cost if we don’t act right now,” State Senate President Bill Ferguson said at a press conference when the funding was announced.

The bipartisan budget agreement was hailed by Gov. Hogan, a Republican, as an example for the nation demonstrating how “people from different parties can still come together, that we can put the people’s priorities first, and that we can deliver real, bipartisan, common sense solutions to the serious problems that face us.”

One “serious problem” in Maryland, according to a recent Abell Foundation report, is that 23 percent of Maryland households (520,000) do not have a wireline home Internet connection, 40 percent (or 206,000) of which are Black households.

Much of that comes from a lack of affordability and other barriers to adoption. To deal with those challenges, the budget agreement also includes $45 million to subsidize monthly Internet service costs for qualifying families and $30 million to pay for Internet-connected devices for financially eligible households. It also includes an additional $4 million for a new University System of Maryland program to support training and developing curriculum to bridge the digital divide as well as $2 million for digital navigator programs.

Snapshot

Maryland plans to funnel American Rescue Plan Act funding towards community broadband 

Vermont Governor bolsters House plan backing Communications Union Districts 

A national movement to address digital inclusion ignites

See the bottom of this post for related job openings

State Scene

Maryland

Maryland State Governor Larry Hogan made digital equity and literacy a top priority of the state when he signed H.B. 97, the Digital Connectivity Act, into law on April 13. The new law establishes the Office of Statewide Broadband (OSB) within the Maryland Department of Housing and Community Development to create a plan to get all Marylanders connected to affordable, high-speed Internet by 2026. The OSB will also assist in administering $300 million for digital equity initiatives out of the $3.9 billion Maryland received in American Rescue Plan funds. 

The $300 million allocation will be broken down into separate pots of money to address physical infrastructure, affordability, and adoption: $45 million will be for grants that support and expand municipal broadband networks; $75 million for affordability initiatives to subsidize the cost of monthly service fees and devices for eligible residents who are subscribers to private Internet Service Providers (ISPs); and $150 million dedicated to deploy broadband infrastructure and expand connectivity in both urban and rural areas. In addition, $10 million is earmarked for local government and community-based solutions, and $6 million will support adoption initiatives, including $4 million for a new division under the University System of Maryland to develop curriculum on digital literacy and addressing the broadband gap.

Five electric cooperatives in three states have joined forces to form a new broadband co-op with a mission to bring high-speed Internet service to the unserved rural parts of Virginia, Maryland and Delaware.

The formation of the Virginia, Maryland & Delaware Association of Broadband Cooperatives (VMDABC) was announced at the start of the new year, harkening back 76 years ago when those same three states formed the Virginia, Maryland & Delaware Association of Electric Cooperatives (VMDAEC) to bring electricity to the rural areas in those states.

“This association is the first of its kind in the nation,” said VMDABC Board Chairman Casey Logan, CEO of the Waverly, Va.-based Prince George Electric Cooperative, and its broadband subsidiary, RURALBAND.

“This is truly a historic day,” Logan said when the tri-state association was announced in January. “Much like the Virginia, Maryland & Delaware Association of Electric Cooperatives was created 76 years ago during the formative years of rural electrification, today’s formal organization of a broadband association will improve the quality of life for our members.”

The VMDABC will begin its work with five founding “Class A members,” each of which are in various stages of building Fiber-to-the-Home (FTTH) networks.

In addition to Prince George Electric Cooperative, the four other founding Class A members are the BARC Electric Cooperative, based in Millboro, Va., and its subsidiary, BARC Connects; the Arrington, Va.-based Central Virginia Electric Cooperative, and its subsidiary, Firefly Fiber Broadband; the Choptank Electric Cooperative in Denton, Md., and its subsidiary, Choptank Fiber LLC; and the Mecklenburg Electric Cooperative, based in Chase City, Va., and its subsidiary, EMPOWER Broadband. Collectively, they provide electric service to 135,000 members.

Envisioning a Path Forward

The Expanding Potential in Communities (EPIC) Grant deadline funded by Truist Bank and administered by the Internet Society has been extended by two weeks from its original deadline of February 19 in the wake of the weather hammering eligible areas over the last few days. There's nothing like a severe winter event that knocks power out for millions to break up the monotony of a raging pandemic. 

Grant applications are now due March 5th by 11:59pm. 

Read our original story about the grant program below:

A new grant program funded by Truist Bank's philanthropic initiative and administered by the Internet Society will disburse $1 million in funds to seven community broadband projects over the next year and a half. The Expanding Potential in Communities (EPIC) Grant program is currently soliciting applications, with grants to be disbursed to eligible communities across the southeast United States, including Washington D.C. and Texas, ranging from $125,000-180,000. The program is aimed at kickstarting Covid 19 relief efforts but also providing essential, locally owned broadband infrastructure to unserved and underserved communities.

From the grant program website:

The COVID-19 pandemic has brought the importance of broadband Internet connectivity into focus as work, school, healthcare, and more shift online. Internet connectivity is more important than ever in keeping our lives moving . . . The $1 million Expanding Potential in Communities (EPIC) Grant program supports broadband initiatives in the southeastern United States . . . As the administrating partner, the Internet Society will support local broadband expansion by funding complementary Internet connectivity solutions to help alleviate disparities in education, employment, and social welfare that are exacerbated by lack of access to broadband.

See eligibility requirements below:

A new grant program funded by Truist Bank's philanthropic initiative and administered by the Internet Society will disburse $1 million in funds to seven community broadband projects over the next year and a half. The Expanding Potential in Communities (EPIC) Grant program is currently soliciting applications, with grants to be disbursed to eligible communities across the southeast United States, including Washington D.C. and Texas, ranging from $125,000-180,000. The program is aimed at kickstarting Covid 19 relief efforts but also providing essential, locally owned broadband infrastructure to unserved and underserved communities.

From the grant program website:

The COVID-19 pandemic has brought the importance of broadband Internet connectivity into focus as work, school, healthcare, and more shift online. Internet connectivity is more important than ever in keeping our lives moving . . . The $1 million Expanding Potential in Communities (EPIC) Grant program supports broadband initiatives in the southeastern United States . . . As the administrating partner, the Internet Society will support local broadband expansion by funding complementary Internet connectivity solutions to help alleviate disparities in education, employment, and social welfare that are exacerbated by lack of access to broadband.

See eligibility requirements below:

The failure of policy and leadership at the federal level in addressing the digital divide was ever more clearly exposed as Covid-19 restrictions were put into place last spring. And, as the pandemic continues to rage, daunting connectivity challenges remain. 

Yes, the Connect America Fund (CAF) II program has doled out over $11 billion since 2015 in subsidies to the big telcos like AT&T, CenturyLink, Frontier, Windstream, and Consolidated ostensibly to upgrade rural broadband to speeds of at least 10/1 Megabits per second (Mbps). But, as Doug Dawson, president of CCG Consulting notes, it’s been a massive subsidy failure given that “even in 2015, it was ludicrous to spend money to build 10/1 Mbps broadband” – the same year the FCC defined broadband as 25/3 Mbps, which means “the FCC was investing in new Internet infrastructure in 2015 that didn’t qualify as broadband at the time of the award of funding.”

And there is reason to doubt that those subsidized upgrades were even completed, even as the FCC just extended the CAF II program for a seventh year.

So as states — and in many instances, local municipalities — step into the breach, the National Governors Association has released a new report that outlines a list of strategies governors can use to increase broadband access in underserved communities. 

Published just before Thanksgiving, the report first lays out the challenge:

According to the FCC, in 2018, at least 18.3 million people lacked access to fixed broadband in the United States that meets minimum [I]nternet access speed of 25/3. 1 Of those 18.3 million people, representing 6 percent of the total population, 14 million live in rural areas and 1 million live on Tribal lands, which amounts to 22 percent and 28 percent of those respective geographic populations [even as] studies have claimed that the FCC data is undercounting the number of people in the U.S. without fixed broadband access, and that the total may be as high as 42 million people.

Almost 54,000 electric cooperative residents will see the benefits of a statewide law change in Maryland after a summer filled with changes. After a state vote to allow deregulation, Choptank Electric, which serves member owners across nine counties in Maryland’s Eastern Shore, voted in August to become member-regulated so that the cooperative can pursue broadband projects in a part of the state that has long suffered from poor or no connectivity options. 

A State Law and a Membership Vote

The process unfolded earlier this year, when representatives for the co-op spoke with the legislature in Annapolis about offering broadband to its members. State law at the time meant that electric utilities were regulated by the Public Service Commission, which prevented them from entering the broadband space. 

The Eastern Shore sits across Chesapeake Bay, with 450,000 people living across its nine counties. Driven by a lack of connectivity options and a desire for economic development, area legislators submitted HB 999, which drew support from dozens of businesses, 1,200 current Choptank customers, and a number of local governments. The “Rural Broadband for the Eastern Shore Act of 2020” [pdf] passed the state legislature on May 8th, 2020, and freed the co-op from regulation by the Public Service Commission. Talbot County resident Pamela Keeton testified to the Senate Finance Committee:

The bottom line is, no one wants to pay taxes and no one wants to spend money, so we’re left with no Internet service.

Across the country, state legislatures are ushering in better rural connectivity by passing new laws that enable electric cooperatives to expand high-quality Internet access. In recent years, much of this legislation has authorized co-ops to deploy broadband infrastructure along existing electric easements. Other bills have removed restrictions that previously prevented electric co-ops from providing Internet access. Together, the new legislation makes it easier for electric cooperatives to bring high-speed broadband access to their members, signaling a brighter future for unconnected rural communities

Indiana in the Lead

Indiana’s state legislature was ahead of the curve when it passed SB 478, the Facilitating Internet Broadband Rural Expansion (FIBRE) Act back in 2017. The FIBRE Act permits electric cooperatives to use easements for their electric poles to also deploy broadband networks. Before the General Assembly passed this legislation, cooperatives that wanted to install communications infrastructure, such as fiber optic lines, along their electric easements would have to gain permission from each individual landowner to attach fiber to the existing poles.

Since the passage of the FIBRE Act two years ago, a number of Indiana electric cooperatives have embarked on broadband projects, including Jackson County Rural Electric Membership Corporation (REMC), South Central Indiana REMC, Orange County REMC, and Tipmont REMC. At the announcement event for South Central Indiana REMC’s fiber project, State Senator Eric Koch, author of SB 478, noted that state legislation like the FIBRE Act was enabling electric cooperatives to expand modern connectivity to rural Indiana.

State Laws Advance Co-op Broadband