Hunt for clarity on BEAD’s future goes on

It’s been three months since Commerce Secretary Howard Lutnick announced a “rigorous review” of the $42 billion federal program designed to expand broadband internet, and for the first time he offered some details about its future.

Lutnick announced the review of the Broadband Equity, Access and Deployment program in early March. Since then, President Donald Trump ended grants under the Digital Equity Act and there has been little else in the way of concrete news.

But Lutnick offered some insight on BEAD’s future in testimony before the Senate Appropriations Committee this week, although details are still thin on the ground. He said he expected a new Notice of Funding Opportunity to be released “shortly,” with every state expected to apply within 90 days and that those applications “are done without regard to favoring one technology over another.”

Lutnick promised to make awards by the end of this year in what would be a very ambitious timeline that could force states to change various administrative processes and accelerate federal grant-making.

“You had the Biden administration sitting on it for 30 months, and you're going to watch us distribute the money and get it out the door, provided the applications are — let's say — technologically agnostic,” Lutnick said. “Just do the right thing for the American people. Let's get broadband to the people in the most efficient way and we will put out the money.”

The wait for firm answers became unbearable for three Democrats in the U.S. Senate, who wrote to Lutnick in late May demanding that he allow states to proceed and give final approval beyond Delaware, Louisiana and Nevada, which received it in early January under former President Joe Biden. The group also warned of the consequences of further delays.

“For six months, states have been waiting to break ground on scores of projects, held back only by the Commerce Department’s bureaucratic delays,” the trio, which included Senate Minority Leader Charles Schumer, wrote. “If states are forced to redo or rework their plans, they will not only miss this year’s construction season but next year’s as well, delaying broadband deployment by years.”

And the group of senators said that those plans, all of which were already approved by the National Telecommunications and Information Administration, are appropriate for each state’s needs and should not be prevented from moving forward. Those plans reflect “local needs, technical realities, and the bipartisan intent of Congress,” they wrote.

At the time, Lutnick said the BEAD review was necessary given some of its “onerous” requirements, something that various elected officials have agreed with. And some industry groups have echoed their desire to see some of the program’s rules loosened, even as they want to see the money flow.

In a press conference ahead of its annual Washington fly-in, representatives with the National Rural Electric Cooperative Association said their members want to move forward. The group represents nearly 900 local electric cooperatives, including over 200 co-ops that provide broadband service in their communities.

“Our members are anxious to get going,” NRECA CEO Jim Matheson said. “They're excited about providing broadband to their membership. The BEAD program has not necessarily moved as quickly as we would all like, and the current state of uncertainty about how it moves forward causes some frustrations for our members that are so excited to move forward with deploying broadband to meet the needs of their rural communities.”

But Matheson said NRECA wants to see some program requirements “streamlined,” including clarification on supply chains and the Buy America rules that incentivize grantees to use products that were made domestically but has a waiver provision too.

“That's where we'd like to add some more flexibility to do the right thing for our members,” Matheson said.

State-level restrictions also weigh heavily on some electric co-op providers. Tim Johnson, CEO of the Otsego, New York, Electric Cooperative, said the state’s requirement to pay a prevailing wage rate for labor is “virtually unavailable” outside of urban areas. He also said the state’s $15-a-month cost threshold for plans offered under BEAD makes it “untenable” from a financial standpoint for the co-op.

And other groups are trying to turn up the heat on states they believe are turning away from BEAD for political reasons. In late March, West Virginia Gov. Patrick Morrissey announced that the state would revise its final BEAD proposal to incorporate “a broader range of technology options, including satellite and mobile wireless technologies.”

In response, the Benton Institute for Broadband & Society late last month published West Virginia’s draft final proposal, which set out how the state would have spent the $1.2 billion it was allocated. The plan noted that satellite internet would not have worked given the state’s “highly mountainous terrain” and “wide range of weather events,” and echoed some of the skepticism found elsewhere.

Instead, the state would have relied heavily on fiber, and delivered it to more than 100,000 locations within four years, while also improving wireless and cellular infrastructure, providing job training among other initiatives.

“Given the openness of the state's BEAD program, the levels of participation from various providers, and the state’s challenging terrain, West Virginia could hardly have hoped for a better outcome than the one it achieved,” Drew Garner, Benton’s director of policy engagement, said in a statement. “[West Virginia] already achieved success that exceeds the expectations of the BEAD Program. So West Virginians might ask, 'What's wrong with this plan?’”