It has been a significant and controversial year for a major federal broadband initiative. The $42.45 billion program, established in 2021 with bipartisan support, aims to provide high-speed internet access to every home and business in the U.S., regardless of location.
Commerce Secretary Howard Lutnick, whose agency is in charge of the program, stated earlier this year that it has become mired in bureaucracy and “woke mandates” under the current administration. He indicated that changes would be made following a thorough review.
Here are four key updates regarding the initiative:
Changes to Key Grant Program:
In June, the administration announced important modifications to the grant program. Initially, the program favored projects utilizing fiber-optic cables to ensure the highest speeds. However, officials claimed this sidelined other technologies such as wireless and satellite internet, which can be cheaper and faster to construct. Lutnick assured that the new rules would maximize taxpayer value and expedite connections. Critics, however, argued that the changes could disadvantage rural residents by opting for more affordable technologies that may not meet future speed demands. Another significant alteration relaxed the requirement for internet service providers receiving grants to offer affordable subscription options to low-income residents.
Digital Skills Grants Scrapped:
In May, the administration abruptly terminated a separate $2.5 billion grant program designed to enhance digital skills and make online access affordable. This program was criticized by the former president as “racist” and “wholly unconstitutional.” In Pennsylvania, this cancellation affected over $25 million designated for the state’s Broadband Development Authority and nearly $12 million for Philadelphia, which aimed to teach digital skills and provide low-cost internet subscriptions. Funding to assist rural residents in accessing telehealth services was also eliminated. The cancellation was part of a broader federal crackdown on diversity and equity initiatives. A lawsuit challenging the administration’s authority to revoke the funding is currently pending in federal court.
Shift Towards Satellite:
In August, Pennsylvania announced which companies would receive grants under its updated proposal. Approximately two-thirds of eligible locations are expected to connect via fiber-optic cables, while 18% will rely on satellite providers and 13% will access wireless internet. The adjustments have allowed satellite technology to play a more prominent role, as officials prioritized projects capable of delivering broadband in challenging terrains. However, no satellite projects were designated as priority, which raises questions about their overall importance in the program.
Uncertainty Over Leftover Millions:
Due to the transition towards satellite and wireless solutions, fewer locations are qualifying for funding since more broadband infrastructure has been developed since the 2021 infrastructure law. Consequently, Pennsylvania anticipates connecting all eligible locations for only $790.7 million, rather than utilizing the full $1.1 billion initially allocated. States were originally permitted to use any unspent funds for digital skills training or providing free laptops. However, this guidance has been rescinded, and a recent executive order ties remaining funds to a federal review of state regulations on artificial intelligence. States identified as having “onerous” laws will lose access to those leftover broadband funds.
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