As states start to allocate funds from the American Rescue Plan Act (ARPA), enacted in March, many policymakers are using some of the new resources to fund broadband expansion, by increasing funding for existing programs or establishing new ones. The relief package, which Congress passed to help Americans struggling because of the COVID-19 pandemic, includes two programs administered by the U.S. Department of the Treasury that can be used to fund broadband improvements: the Coronavirus Capital Projects Fund and the Coronavirus State and Local Fiscal Recovery Fund.
The Coronavirus Capital Projects Fund includes $10 billion that states can seek in order to invest in capital assets that enable work, education, and health monitoring, including remote options, and to address critical community needs made apparent by the COVID-19 public health emergency. This can include broadband infrastructure projects, digital connectivity technology projects, and improvements to connectivity, device, and digital literacy at “multi-purpose community facilities.”
The Coronavirus State and Local Fiscal Recovery Fund will provide $350 billion for projects intended to combat the pandemic’s economic fallout and lay the foundation for a strong recovery. Eligible state, local, territorial, and tribal governments have significant flexibility in determining how to allocate the funds based on local needs; among the eligible uses are “necessary investments in water, sewer, or broadband infrastructure.”
This funding is separate from the recently enacted Infrastructure Investment and Jobs Act, which will provide an additional $65 billion to help policymakers address high-speed internet access and adoption.
With the pandemic driving home the critical importance of high-speed internet, states across the country are using ARPA money to expand broadband access and affordability. Appropriators have increased funds for infrastructure deployment grants, and some have used Capital Projects Fund or State and Local Fiscal Recovery Fund allocations to pay for specific projects related to mapping, education, or public health.
States are prioritizing improvements to broadband infrastructure with their ARPA funding allocations. As of November, legislatures in nearly half of the states had appropriated ARPA money for infrastructure grants to ensure that broadband services reach unserved and underserved areas, though not all states have specified which fund they are drawing from for proposed projects. Much of this money is going to expand existing programs, though some is being used to establish new broadband grant programs.
California, which has a robust existing broadband grant program, falls into the first category. Lawmakers there have directed ARPA funds to several state agencies to further expand broadband deployment. Of California’s allocation, the state Legislature allotted $3.25 billion for the Department of Technology to oversee construction and subsequent maintenance of a statewide open-access middle-mile network and $500 million for the Public Utilities Commission to oversee last-mile projects. The middle-mile network links the broadband backbone to local internet networks—the last mile. Lawmakers approved $22.4 million for the Public Utilities Commission to facilitate these projects and oversee distribution of funds.
These investments align with the state’s 2020 broadband plan action item to “prioritize funding open access, middle-mile infrastructure, including connections to anchor institutions” as part of its goal of ensuring that all Californians have access to broadband. Indiana, meanwhile, appropriated $250 million to the Office of the Lieutenant Governor for broadband expansion grants.
Colorado also has an existing broadband grant program but is using ARPA money to establish additional funding opportunities. Lawmakers appropriated $35 million each to newly established digital inclusion and broadband stimulus grant programs, and $5 million for a new interconnectivity grant program. Hawaii used $5 million of its ARPA allocation to launch a broadband infrastructure grant program, which will award grants for deployment in unserved and underserved areas. And Montana appropriated $275 million of its ARPA money to a new effort to fund communication projects related to broadband infrastructure, which the legislation says could include cell towers or public safety improvements.
In addition to general infrastructure grants, some states have focused on more specific needs when allocating their broadband deployment funds. For example, Texas lawmakers appropriated $500 million for broadband infrastructure with a requirement that $75 million be used for pole replacement. That step was intended to ensure that older, deficient utility poles can be replaced to enable installation of new broadband infrastructure. And in Kentucky, legislators appropriated $50 million for broadband projects “in furtherance of securing economic development opportunities for commercial and industrial customers.”
Several states have also put a priority on increasing broadband connections for low-income households through line extensions, which expand connectivity to unserved streets and neighborhoods, as well as other affordability measures. Connecticut, for example, appropriated $10 million for low-income and multifamily curb-to-home broadband buildouts in addition to $10 million for grants to underserved areas.
Virginia appropriated $8 million for the state’s Line Extension Customer Assistance Program to make sure that existing networks reach low-to-moderate-income residents. And out of $276 million appropriated for broadband infrastructure deployment, Washington set aside $5 million for equity and affordability grants. That money will be used to assist eligible applicants in areas with access to minimum speeds of 100 megabits per second (Mbps) for downloads and 20 Mbps for uploads. The state broadband office and department of equity will identify areas where access to existing service is not affordable or equitable.
States are also using ARPA money to fund specific initiatives that extend broadband access to support high-speed internet access for education, public health, and transportation. Connecticut appropriated $9.5 million for statewide geographic information system (GIS) capacity to improve state broadband availability maps, $10 million for Connecticut Education Network Wi-Fi connectivity and broadband in public spaces, and $25 million for connectivity at health and mental health organizations.
Virginia is using a portion of its funds to support public health, with an $8 million appropriation to the state Department of Health to address connectivity and infrastructure issues at local health departments.
Arizona has focused its broadband appropriation on highways, allocating $100 million to its Department of Transportation to expand broadband infrastructure along interstates 17 and 19 to increase broadband affordability in rural areas. That work will also help to improve highway safety and enable smart infrastructure projects in rural and tribal areas.
When state legislatures reconvene in 2022, more lawmakers will consider allocating ARPA funds for broadband. Eventually, they will repeat that process with the $65 billion for broadband expansion in the infrastructure bill. That measure includes funding for broadband infrastructure and programs focused on affordability, digital literacy, and device access. Such strong federal support has enabled states to speed the economic recovery from the pandemic and will be critical to their efforts to end the digital divide.
Anna Read is a senior officer and Kelly Wert is an associate with The Pew Charitable Trusts’ broadband access initiative.