Commerce's BEAD Change and Review Leaving States Confused

It's unclear if Louisiana, Nevada and Delaware, which have already received final NTIA approval for their BEAD plans, must return to the drawing board or if other states in the midst of receiving bids will need to pause, said Kathryn de Wit, project director of Pew Charitable Trusts' broadband access initiative, in an emailed statement. States have done sizable work over the past three years "to collect the data and perform the due diligence required to not only bring internet access to the millions of American households that lack it, but also to ensure those funds are spent according to statute," she added. Also unclear is how much a lack of fiber preference means less use of fiber and more employment of alternative technologies, she said. Those alternatives, such as satellite and fixed wireless, "have always been part of the solution," and states had the ability to use them in their BEAD planning. For example, she said, about 80% of Nevada's unserved locations are to be addressed by fiber, and 9% by satellite. "Any effort to achieve universal broadband should prioritize reliable and resilient fiber networks, but we recognize that in some circumstances that is not feasible."

More than half the states are in the midst of or have finished the subgrantee process, said Jade Piros de Carvalho, Bonfire Infrastructure Group vice president-broadband advocacy and partnerships. But the program faces "more uncertainty than ever," she told us. Commerce pushing tech neutrality could upend BEAD and require states to redo application windows, which seems unlikely as it would upset the public and large providers, she said. Louisiana, Nevada and Delaware -- now waiting on sign-off by Commerce's National Institute of Standards and Technology as the last BEAD approval step -- "are too far down the line to yank it back."

State broadband lawyer Philip Macres of Klein Law said satellite will likely be elevated in the BEAD program to be considered a reliable broadband service for scoring purposes, alongside such technologies as fiber, DSL and licensed fixed wireless. He said Commerce might let Nevada, Louisiana and Delaware move ahead on awarding bids for fiber builds at a certain price per household, but some extremely high-cost areas have prices that likely fall well outside what Commerce will want to approve.

Macres said it's likely there will be tighter "guardrails" on states' BEAD spending, probably limiting it to deployment or workforce development. He said anything above and beyond that would likely go back to NTIA. In addition, Commerce will likely kill some of the BEAD mandates on bidders, such as that they provide a low-cost program, employ fair labor practices and obtain letters of credit.

Incompas CEO Chip Pickering blogged Thursday that states should have the ability to use excess BEAD funds to increase network capacity and infrastructure for AI-related needs. He also urged permitting reforms and making BEAD grants not taxable.

Pointing to the 365-day deadline that states have to get their final proposal to NTIA after getting OK for their complete initial proposal, Macres said NTIA needs to consider pausing deadlines. This would give states time to retool their programs, allow bidders to amend applications and let everyone see what changes Commerce will make to BEAD.

However, numerous states clearly weren't going to meet that one-year deadline, said Piros de Carvalho. NTIA was "a bottleneck," and it was going to be hard for it to say it wasn't going to give waivers and extensions, she said.

Moreover, states aren't going to want to take a wait-and-see approach concerning other changes Commerce makes to BEAD, Piros de Carvalho said. They already have spent considerable time and money on the subgrantee process under the existing rules, she said, adding that they also might be hesitant to change their scoring rubrics with little to no public input. Bidders also don't want to have to redo their work, given the tens of thousands of dollars spent on engineering consultants and other expenses.

There also could be lawmaker pushback to redoing applications. Senate Commerce member Shelley Moore Capito, R-W.Va., said that while she backs improving BEAD, "I do not want to see West Virginia wait longer than is necessary or have to redo their proposals and application."