Broadband
The American Rescue Plan Act of 2021 (ARPA) includes hundreds of billions of dollars for which broadband projects are an allowed use, whether in schools, communities or public libraries. By November 2021, legislatures in almost half of the states had appropriated ARPA funds for broadband infrastructure grants in amounts ranging from tens to hundreds of millions of dollars.
In recent years, state programs have received applications in excess of available funds, says Anna Read, senior officer for the Pew Charitable Trusts Broadband Access Initiative. “State grant programs to date have focused on expansion of last-mile infrastructure to unserved areas,” she says. Stimulus dollars are enabling states to allocate funds for other purposes, including mapping, public space connectivity, free wireless broadband for public housing residents, municipal broadband pilots and planning.
Looking ahead for 2022, broadband expansion faces a number of stumbling blocks that include supply chain issues and a need for more workers to build, deploy and maintain broadband services, says Shirley Bloomfield, chief executive officer of NTCA–The Rural Broadband Association. Focus on training and apprenticeship could address the latter need.
The Infrastructure Investment and Jobs Act (IIJA) included $65 billion for broadband expansion. The majority of that money, $42.5 billion, will fund a grant program to be administered by the National Telecommunications and Information Administration (NTIA). “NTIA has a huge task ahead in an area where they do not have staff or expertise,” says Bloomfield. “Look for growing pains there.”
Each state will receive at least $100 million for broadband infrastructure, mapping and adoption projects, the remainder awarded on the basis of the number of underserved or high-cost locations in individual states. If a state is unable to submit an application by the funding deadline, an application can be made in its place by a political subdivision or a consortium of subdivisions.
Grant dollars won’t start flowing from NTIA until 2023, but states have much to do in 2022 to be ready to get in line for them. Proposals for funding must be accompanied by a five-year state action plan that reflects meaningful coordination with local and regional entities.
If the goal of these projects is to ensure equitable access, poor data regarding coverage will thwart the best intentions, says Francella Ochillo, executive director of Next Century Cities. It’s important to ask questions about how coverage data is being collected, she says, that it’s not just “top-down” from the FCC to states.
If service is available to just one household in a census tract, the FCC considers the tract to be covered, whether even one household is connected or not. “We need to make sure we’re using bottom-up methodologies to learn from municipalities, counties, unincorporated areas, places that are finding ways to collect data on their own to inform larger data sets.”
Ochillo is also concerned about the standards for connectivity speeds that are built into projects. The FCC benchmark of 25 Mbps download and 3 Mbps upload, used for many projects, was established in 2015. “I think it’s problematic to push money out the door based on a speed threshold that you know is becoming obsolete — we need to make sure that our communities are able to get the best speed that is available to them.”
As more municipalities incorporate broadband within their economic development planning, the issue of speed has particular significance. It’s not just a matter of access to texting and email but ensuring that all citizens have access to the full range of commercial, educational and work resources necessary for 21st-century communities to remain economically viable.
“Last-mile” needs aren’t just about broadband connections. A holistic approach should encompass increasing digital literacy among users and providing devices and tech support where necessary. It’s important to think from the perspective of those who are disconnected, says Ochillo, which is not necessarily the reality of those making broadband policy. What does broadband “access” mean if a family shares a single smartphone and can only afford so much data?
If short-term federal funds are a big part of the reason that broadband becomes affordable to low-income citizens, jurisdictions will have to think about long-term strategies to keep prices down. “We need to remind policymakers that building broadband may be sexy, but maintaining those networks and keeping them affordable will be just as important,” says Bloomfield.
ARPA and IIJA dollars are the most significant broadband investments to date, says Pew’s Anna Read. “A lot is still to be determined about how this funding will be prioritized and used, but it does create an opportunity to make real progress in closing remaining gaps in broadband access and adoption.”
— Carl Smith
(David Kidd/Governing)
Federal Spending/Infrastructure
In 2020, state and local governments faced a crisis of previously unimaginable proportions. As the pandemic swept the country, communities shut down of their own accord before governments issued stay-at-home orders. The need for public services surged, even as revenues plummeted. Although the gargantuan assistance packages issued under Donald Trump’s administration helped the economy stay afloat, and kept some revenue streams healthy, Republican policymakers at the federal level declined to make aid available for state and local governments.
That changed under Joe Biden’s administration, which issued its own rescue package, which was targeted less towards business assistance and more towards bolstering the public sector and aiding households. The American Rescue Plan Act (ARPA) provided $350 billion to local and state governments, with stipulations that it could not be used to cut taxes.
But as the economy roared back to life, some of these governments — at least at the state level — proved to be in surprisingly strong fiscal health. Much of the ARPA money has not yet been spent, leaving some conservatives to claim it was a waste.
There are a variety of reasons why some jurisdictions haven’t yet begun spending the money. During the Obama administration, Biden was in charge of implementing the 2009 stimulus act, which was famed for its lack of pork and its stringent safeguards against fraud, waste and abuse. Similar guardrails have been put in place with ARPA, which have the side effect of making it difficult to spend the funds quickly.
“The more strings that are attached to funding, the more slowly it’s allocated and dispersed,” says Amanda Page-Hoongrajok, assistant professor of economics at Saint Peters University. “There’s a lot of questions policymakers have if they can use these funds for this or that. That’s a big part of why it’s taking so long. More strings attached to funding means it’ll be better targeted, but it’s also going to slow things down.”
There is also speculation that delays in 2021 could be attributed to some policymakers wanting to wait and see what would come of the Biden administration’s additional spending plans. A city that wants to spend on broadband access may have waited to see if the infrastructure act passed, so that the ARPA money could be better spent elsewhere. The same logic holds with the Build Back Better bill’s climate change and welfare state provisions.
But they can’t delay forever, and with Build Back Better’s future uncertain that calculus no longer makes sense. The ARPA funds must be allocated by 2024 and spent by 2026. That means fights over how it will be spent will occur this legislative session, as will battles over funds from the bipartisan infrastructure act.
At the county level there is $65.1 billion to be spent from the ARPA. The National Association of Counties describes an array of initiatives the money is being allocated to, from public health to sewer systems to homeless services. These funds could be used to fill gaps in need left by the vanishing federal household and business supports from 2020 and 2021.
“An example would be purchasing additional property to provide housing and wraparound services to those experiencing homelessness,” says Teryn Zmuda, chief economist with the National Association of Counties. “We’ve also talked a lot about workforce and re-employment efforts and small business assistance to business owners impacted by the pandemic.”
The National League of Cities has been tracking ARPA spending across 169 cities that have spent $4.23 billion. So far, 18.5 percent of that has been spent on infrastructure projects, 7.6 percent on public space improvements, and 7.4 percent on sewer and water projects. In cities like Allentown, Pa., much of the $36 million it received was spent on capital improvements like new filters in the city’s water distribution plants, three miles of water main replacements, and storm sewer improvements. Richmond, meanwhile, spent $19 million on stormwater management and climate risk assessment.
“What we’re seeing pretty broadly is that there is a lot of delayed maintenance that needs to be done in our cities,” says Brooks Rainwater, senior executive with the National League of Cities. “These dollars that have been flowing through are being used to bring our communities up to where they need to be.”
At the state level, where Republicans control the majority of statehouses, debates over funds have been more contentious. Many GOP leaders want to use the robustness of their current budgets to reduce taxes, although the Biden administration tried to keep states from using emergency federal dollars for such a purpose.
States will also drive infrastructure act spending. Much of the resources in that law will be fielded through state departments of transportation, which have a mostly untapped ability to spend these federal disbursements in innovative ways. There is also a great deal of competitive dollars in the infrastructure bill that some experts believe state agencies will have to leverage — especially in rural areas and other economically depressed locales.
“What’s different about the infrastructure bill compared to past investments is that there’s a whole chunk of money which is competitive,” says Bruce Katz, director of the Nowak Metro Finance Lab at Drexel University. “We’ve degraded the public sector to such an extent that most places don’t have the capacity to deploy funds intelligently or even apply for a lot of the competitive money.”
Katz argues that it will fall to states to be the platform for such planning in 2022 and beyond, and to build capacity and deal with dozens of separate municipalities and counties under their control. It remains to be seen how many will decide to use the federal dollars in new and innovative ways.
— Jake Blumgart
