Biden administration signals incumbents likely to be favored in challenges of proposed state FTTP builds under infrastructure bill

Federal grant money for advanced telecommunications infrastructure that would flow to states appropriated in the Infrastructure Investment and Jobs Act prioritizes projects in areas determined by maps under development by the Federal Communications Commission (FCC) that would serve premises where at least 8 of 10 prems cannot order advanced telecommunications service providing minimum throughput of 25/3 Mbps.

Under the bill expected to be signed into law next week, states receiving the funding can award up to 75 percent of the project’s capital cost as subgrants. The measure specifies states first fund builds that would serve these “unserved” premises. States can then award grant funds to projects where at least 80 percent of prems in a proposed project are “underserved,” which as defined in the bill means those that cannot order service providing minimum throughput of 100/20 Mbps and with latency sufficient to support real-time, interactive applications.

But in order to do so, states must first certify to the Department of Commerce’s National Telecommunications and Information Administration (NTIA) that the bill authorizes to oversee the grants there are no “unserved” premises in the state.

Combined, these provisions stringently proscribe the scope of state sponsored projects in most states.

However, the bill affords the NTIA a fair degree of discretion. It authorizes it to fund “priority broadband projects” that provide advanced telecommunications service that meets throughput and quality of service standards as determined by the NTIA. As well as those that would “easily scale speeds over time to meet the evolving connectivity needs of households and businesses and support the deployment of 5G, successor wireless technologies, and other advanced services.” That could reasonably be interpreted as a fiber to the premises (FTTP) infrastructure standard.

A likely scenario is states and particularly those wishing to fund publicly and consumer cooperative owned FTTP projects will face push back from incumbent investor-owned telephone, cable and fixed wireless operators challenging their funding under the bill, contending they already provide 25/3 Mbps or 100/20 Mbps throughput to at least 80 percent of prems where FTTP is proposed to be built – what they term as “overbuilding.”

States must establish a “transparent, evidence-based, and expeditious challenge process” in which advanced telecommunications providers can contest a proposed project’s eligibility and whether a particular prem within the proposed project is unserved or underserved. States would have 60 days to resolve challenges. The bill authorizes the NTIA to modify the challenge process and overrule state determinations of challenges.

A question as the bill is implemented is to what extent the NTIA will exercise its discretion as permitted under the bill to favor publicly or cooperatively owned FTTP projects. Or side with commercial incumbents bringing challenges to proposed state projects. Department of Commerce Secretary Gina Raimondo offered a clue the Biden administration may be inclined to side with incumbents on challenges. "We have to make sure we don't spend this money overbuilding," Raimondo was quoted as saying in this November 9, 2021 Reuters story.

The Infrastructure Bill is About More than Money | Benton Institute for Broadband & Society

The Infrastructure Bill is About More than Money | Benton Institute for Broadband & Society: it is now the policy of the United States that: Subscribers should benefit from equal access to broadband internet access service within the service area of a provider of such service; "Equal access" means the equal opportunity to subscribe to a service that provides comparable speeds, capacities, latency, and other quality of service metrics in a given area, for comparable terms and conditions; and The FCC should take steps to ensure that all people of the United States benefit from equal access to broadband internet access service.

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The Benton Institute is right. While the billions appropriated to the states in the advanced telecommunications infrastructure component of Infrastructure Investment and Jobs Act headed to President Biden's desk gets most media attention, the measure contains important expressions of telecommunications policy. How they ultimately end up being implemented will be crucial headed into 2022 and beyond.

The Benton Institute's call that the U.S. Federal Communications Commission act to ensure the "equal access" provision sounds in the Title II universal service and anti-redlining requirements enacted in the FCC's 2015 Open Internet rulemaking reclassifying Internet Protocol delivered services as a common carrier telecommunications utility.

In an executive order issued in July, President Biden called on the FCC to reinstate that rulemaking that was repealed in 2018 during the Trump administration that deemed IP services as optional information services under Title I of the Communications Act of 1934. The order also calls on the FCC to initiate a rulemaking to require service providers to regularly report price and subscription rates to the public in a useful manner to improve price transparency and market functioning. The infrastructure bill mandates the FCC convene a proceeding to determine how to achieve universal service and to recommend to Congress expand it “if the Commission believes such an expansion is in the public interest.”

Another key policy issue that will be addressed in the infrastructure bill's implementation is the role of public sector and nonprofit entities like consumer utility cooperatives. When the Biden administration issued its foundation for the infrastructure bill -- the American Jobs Plan -- it clearly favored them as more nimble and complete builders and operators of much needed infrastructure as shown in this paragraph from the plan:

Build high-speed broadband infrastructure to reach 100 percent coverage. The President’s plan prioritizes building “future proof” broadband infrastructure in unserved and underserved areas so that we finally reach 100 percent high-speed broadband coverage. It also prioritizes support for broadband networks owned, operated by, or affiliated with local governments, non-profits, and co-operatives—providers with less pressure to turn profits and with a commitment to serving entire communities.

The pressure private investor owned vertically integrated telephone and cable companies face to generate profits works against full deployment in their putative service territories. That has brought about longstanding, widespread gaps in landline connectivity to homes and small businesses, creating a pattern of Swiss cheese holes in delivery infrastructure in urban, suburban, exurban and rural areas with the latter two categories most severely affected.

Broadband mapping provision of House-passed infrastructure measure poses risk to timely disbursement of state funding

The Largest U.S. Investment in Broadband Deployment Ever | Benton Institute for Broadband & Society: Broadband Equity, Access, and Deployment Program (And the Need for Better Broadband Maps) The U.S. Department of Commerce's National Telecommunications and Information Administration (NTIA) has six months to create the Broadband Equity, Access, and Deployment Program to support projects to construct and deploy broadband networks. Congress has allocated $42.45 billion for the program which will prioritize expansion of broadband in rural areas and states that rank below other states on broadband access and deployment. A key element in the implementation of the program is broadband mapping taking place at the Federal Communications Commission. The FCC is in the process of updating its current broadband maps with more detailed and precise information on the availability of fixed and mobile broadband services.

The Broadband Deployment Accuracy and Technological Availability (DATA) Act, signed into law in March 2020, requires the FCC to change the way broadband data is collected, verified, and reported. Specifically, the FCC must collect and disseminate granular broadband service availability data (broadband maps) from wired, fixed-wireless, satellite, and mobile broadband providers. To do this, the FCC is required to establish the Broadband Serviceable Location Fabric (a dataset of geocoded information for all broadband service locations, atop which broadband maps are overlaid) as the vehicle for reporting broadband service availability data. Additionally, the FCC must put forth specified requirements for service availability data collected from broadband providers, and it must create a challenge process to enable the submission of independent data challenging the accuracy of FCC broadband maps.

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This provision of the Infrastructure Investment and Jobs Act that passed the U.S. House of Representatives late this week and expected to be quickly signed into law is the largest risk factor to the measure's timely implementation. 

Given the nation's fraught history of broadband mapping, that key provision of the funding eligibility formula and the development of procedures to challenge their accuracy is likely to set off time consuming controversy between investor owned providers, consumer interest and state and federal regulators, bogging down federal disbursements for months and possibly years. The billions of dollars at stake provide impetus for these groups to file challenges and raise questions over the accuracy of the maps, neighborhood by neighborhood.

Eligibility for up to 75 percent grant funding for advanced telecom infrastructure builds is prioritized to “unserved areas,” defined as those where at least 80 percent of premises are unserved – those not having any providers offering service with throughput of at least 25 Mbps down and 3 Mbps up. That's open to gaming by fixed wireless providers who could conceivably claim offers of service meeting or exceeding the throughput minimum but at exorbitant rates.

“Underserved” areas – defined those lacking access to “reliable broadband service” with no providers offering service with throughput of at least 100 Mbps down and 20 Mbps up are secondarily eligible. For both categories, funding eligibility is limited to areas where least 80 percent of premises are unserved or underserved. Neighborhoods failing to meet the 80 percent threshold would be out of luck and continue to potentially suffer redlining by incumbent providers serving only select parts of them.