Senator Ted Cruz on Friday released a report questioning whether the $42.5 billion Broadband Equity, Access and Deployment (BEAD) program can fund “truly unserved areas.” He also argued the NTIA’s preference toward fiber projects will “waste” taxpayer dollars.
Cruz highlighted BEAD is one of a dozen federal broadband programs that have allocated at least $1 billion. Other notable government programs include the $21.6 billion High Cost Program, which includes the Rural Digital Opportunity Fund and Alternative Connect America Model, as well as the $10 billion Capital Projects Fund.
According to the report, the federal government over the past four years has appropriated over $125 billion in funding for broadband.
ITIF in July released a study questioning the effectiveness of some of these rural broadband programs, arguing they may be redundant in the wake of BEAD.
Earlier this summer, the White House unveiled how much each state and territory would receive for its BEAD allocation, with Texas, California and Missouri among the big winners.
The NTIA said it calculated allocations based on unserved location data in the Federal Communications Commission’s national broadband map. But Cruz claimed the resulting allocations “disproportionately benefited states with few unserved locations.”
He pointed to Washington D.C. and Delaware as examples, which he said received more than $547,000 and $52,000 per unserved location, respectively. Both got an allocation “significantly” greater than the nationwide median allocation of $5,600 per unserved location.
Cruz also referenced data from the FCC’s map, stating 58 of 184 unserved locations in D.C. are at the Smithsonian National Zoo.
“Providing Washington, D.C., which appears to have almost no unserved locations, with such a disproportionately large amount of funding diverts BEAD funds from truly unserved areas of the country,” Cruz wrote.
Some analysts have flagged disparities with BEAD allocations. PwC Principal Dan Hays told Fierce he was surprised by how much money the government awarded to U.S. territories in comparison to some of the state awards.
Cruz further called out the NTIA’s preference to prioritize BEAD funds for fiber projects. Specifically, he said “tilting rules to favor specific types of providers harms innovation and drives up costs for taxpayers.”
For instance, the NTIA encouraging states to set their extreme high-cost location thresholds as high as possible “effectively block states from funding non-fiber projects without permission from the agency despite what the law says.”
The senator added the NTIA “ignores the reality” alternative technologies like fixed wireless and satellite may be more suitable than fiber in some areas.
The report referred to Massachusetts’ Tuckernuck Island, stating it has access to satellite service with speeds that exceed the thresholds set by Congress for BEAD.
“However, because the Biden administration’s BEAD rules summarily exclude certain technologies—namely unlicensed fixed wireless and satellite—from being considered ‘reliable broadband service,’ the entire island is considered unserved for the purposes of BEAD and eligible to be overbuilt,” Cruz wrote.
WISPA, CCAGW weigh in
Matt Mandel, VP of government affairs at WISPA, said the trade group “strongly agree[s]” with Cruz’s report.
He argued the BEAD rules on alternative technologies may open up some areas to “needless overbuilding.”
“This not only undermines billions of dollars of private investment and, to a growing extent, public investment, it will inhibit or prevent broadband investment by the very players most likely and able to do so in the future,” Mandel said in a statement. “The communities they serve will suffer negative short, near, and long-term effects as a result. NTIA can avoid this deleterious outcome.”
The Council for Citizens Against Government Waste (CCAGW) said it “was pleased” to see the report’s findings.
“As noted by Sen. Cruz, there is enough BEAD funding to bring broadband connectivity to every household and business in America,” the nonprofit wrote in a blog post. “However, if the administration continues its path of wasteful, duplicative, anti-competitive, and anti-consumer and taxpayer spending, this goal will remain unachievable.”