Senate Republicans: Don’t let states choose where to spend broadband money

Senate Republicans are crying foul over a Biden administration plan to fund broadband deployment in regions that are already served with 25Mbps download and 3Mbps upload speeds.

The US Treasury Department's recently issued final rule for distributing American Rescue Plan money eliminated an interim requirement that blocked broadband funds in areas that already have wired networks with speeds of at least 25Mbps/3Mbps. That speed threshold would leave out any area that's already served by at least one cable provider, even if there's no competition and no fiber-to-the-home availability.

The Treasury Department's reversal was praised by community broadband advocates who said that keeping the original 25Mbps/3Mbps threshold could prevent deployment to large portions of the US containing more than 90 percent of Americans. The nation's current broadband maps are also unreliable, raising the possibility that even homes without 25Mbps/3Mbps broadband access could be excluded.

But 11 Senate Republicans on Friday urged Treasury Secretary Janet Yellen to go back to the original rule. They wrote in a letter:

The final SLFRF [Coronavirus State and Local Fiscal Recovery Funds] rule increases the risk of overbuilding existing broadband investments. First, the final rule eliminates a key requirement that eligible broadband projects provide service to unserved or underserved households or businesses that lack access to minimum speeds of 25Mbps download/3Mbps upload. Instead, recipients can invest in projects designed to serve locations with "an identified need for additional broadband infrastructure investment"—a vague and subjective standard. The rule also permits recipients to invest in projects regardless of whether there is an existing federal or state funding commitment. As a result, the final rule will allow SLFRF recipients to fund projects in areas where broadband service is already or will be available—while continuing to leave truly unserved areas in our states without access to broadband.

GOP: Don’t let states “choose whatever” they want

The letter further objected to the fact that "[i]n addition to federal and state broadband data, funding recipients are permitted to consider user speed tests, interviews, and 'any other information they deem relevant' when determining whether to fund a broadband project in a given area." The Republican senators want state governments to have less leeway in distributing funds, writing that "the broad nature of this guidance allows states to choose whatever information they wish to determine the availability of broadband in a given area."

The letter concluded by urging Treasury "to ensure that SLFRF funds are focused on truly unserved areas to maximize the benefit to those Americans currently without broadband service." The letter was led by Sen. Jerry Moran (R-Kan.) and was signed by fellow members of the Senate Commerce Committee, including Roger Wicker (R-Miss.), John Thune (R-S.D.), Shelley Moore Capito (R-W.V.), Marsha Blackburn (R-Tenn.), Roy Blunt (R-Mo.), Ted Cruz (R-Texas), and Deb Fischer (R-Neb.). It was also signed by Senators Thom Tillis (R-N.C.), Richard Burr (R-N.C.), and Susan Collins (R-Maine).

Both the interim and final rules said that funded projects must "reliably meet or exceed symmetrical 100Mbps download and upload speeds," or at least 100Mbps download and 20Mbps upload speeds in areas where symmetrical speeds aren't practicable "because of the excessive cost of the project or geography or topography of the area."

The Treasury Department says the SLFRF includes $350 billion for state, local, and tribal governments "to support their response to and recovery from the COVID-19 pandemic." Over $245 billion has already been distributed. Broadband infrastructure is one of many funding areas; others include schools, hospitals, child care facilities, premium pay for essential workers, vaccine services, affordable housing, and water and sewer infrastructure.

Given the mix of funded projects, the exact amount going to broadband could be higher or lower depending on the criteria adopted by the Treasury Department. The law that created the fund didn't provide specific guidelines for broadband projects, leaving it up to the Biden administration to make those decisions.

Community broadband advocates pushed for change

In contrast to Republican senators, community broadband advocate Christopher Mitchell says the Treasury Department's final rule is a big improvement over the interim one. Mitchell, director of the Community Broadband Networks Initiative at the Institute for Local Self-Reliance, wrote:

Treasury released an Interim Final Rule in May 2021, detailing how local governments would be allowed to invest in broadband. I promptly freaked out at the restrictions and complications that I (and others) feared would result in local governments backing away from needed broadband investments due to fears of being out of compliance with the rule.

Mitchell wrote that his group "worked with numerous local leaders and the National League of Cities to explain the problems we saw in the proposed rule," and "after many months of deliberations, the Treasury Department has resolved all of the concerns that we identified as areas of concern in May." As a result, "local governments have wide latitude to use SLFRF funds for a variety of needed broadband infrastructure investments, especially to resolve affordability challenges."

Final rule gives local gov’t more leeway

In its final rule, the Treasury Department noted that local governments and other commenters "argued that limiting investments to locations without access to reliable wireline 25/3Mbps was too restrictive because some urban jurisdictions are already mostly or entirely covered by a network with at least 25/3Mbps speeds yet lack widespread broadband adoption for various reasons." Additionally, "many commenters suggested that affordability should be considered a key factor when determining whether a community has access to broadband, as the presence of 25/3Mbps service does not necessarily mean the service is financially accessible to the area's residents," the Treasury Department said. Some commenters argued that the 25Mbps/3Mbps threshold for deciding who is "unserved" is inconsistent with Treasury's requirement that new projects aim for symmetrical 100Mbps speeds.

Ultimately, the Treasury Department decided that funding "recipients may choose to consider any available data, including but not limited to documentation of existing broadband Internet service performance, federal and/or state collected broadband data, user speed test results, interviews with community members and business owners, reports from community organizations, and any other information they deem relevant." Local governments can use their own judgment based on data and their own research:

In evaluating such data, recipients may take into account a variety of factors, including whether users actually receive Internet service at or above the speed thresholds at all hours of the day, whether factors other than speed such as latency, jitter, or deterioration of the existing connections make their user experience unreliable, and whether the existing service is being delivered by legacy technologies, such as copper telephone lines (typically using Digital Subscriber Line technology) or early versions of cable system technology (DOCSIS 2.0 or earlier), and other factors related to the services to be provided by the project. In addition, recipients may consider the actual experience of current broadband customers when making their determinations; whether there is a provider serving the area that advertises or otherwise claims to offer broadband at a given speed is not dispositive.

Treasury "encouraged" funding recipients to prioritize projects in "locations not currently served by a wireline connection that reliably delivers at least 100Mbps of download speed and 20Mbps of upload speed." The final rule also "requir[es] that recipients use a provider that participates in a qualifying affordability plan."

25/3Mbps standard is 7 years old

Separately from the American Rescue Act, Congress approved $42.45 billion for a broadband-specific fund. That fund is somewhat like the original Treasury rule as it prioritizes subsidies to ISPs that build in unserved areas and defines unserved locations as those without access to 25Mbps/3Mbps speeds and without access to "latency sufficient to support real-time, interactive applications." But it also allows subsidies in "underserved locations" without access to 100Mbps download and 20Mbps upload speeds.

The $42.45 billion fund is less ambitious than Biden's original plan, which had more money and would have prioritized funding for municipal networks and nonprofits. The fund will be administered by the National Telecommunications and Information Administration, and the money will be released sometime after the Federal Communications Commission finishes developing upgraded broadband availability maps.

The 25Mbps/3Mbps broadband standard has been used for a variety of purposes since it was set by the FCC in January 2015. Trump-era FCC Chairman Ajit Pai never updated the standard, claiming in his final report that 3Mbps uploads are still fast enough for home Internet.

FCC Chairwoman Jessica Rosenworcel has been pushing for a faster standard for years and is likely to raise it after the commission finally gets a Democratic majority. Democratic senators have also called for a faster standard, saying the current asymmetrical approach with slow upload speeds is outdated. A new FCC standard wouldn't retroactively affect decisions made by Congress or other agencies, but it could influence the criteria for future funding programs.