The COVID-19 pandemic caused a sudden and massive disruption in all facets of our lives. For many Californians, this included a shift to a remote workplace and a public education system that relied on distance learning to deliver instruction. This shift revealed the underlying inequities of California’s broadband infrastructure in many parts of the state. To address these issues, the California State Legislature approved, and Governor Gavin Newsom signed, AB 156, a massive $6 billion investment in the state’s broadband infrastructure.
The California Public Utilities Commission manages allocations through the California Advanced Services Fund (CASF), which is the primary funding mechanism for broadband infrastructure investments. AB 156 provides some exciting opportunities for local governments to make substantial improvements to their local infrastructure, which will help address the digital divide and support economic growth.
This legislation heavily emphasizes “last mile” broadband infrastructure, which refers to the final leg of a telecommunications network that delivers services to customers. The word “mile” is used metaphorically, not as an actual measurement of distance. “Middle mile” infrastructure links a network operator’s core network to a local network facility.
Broadband Infrastructure Grant Account
AB 156 will transfer $300,000,000 into the Broadband Infrastructure Grant Account, an existing annual grant program where applications are traditionally due on April 1st of each year. The aggregate amount of grant funding for an individual project shall not exceed $5,000,000. Service providers and local government jurisdictions are eligible to apply for funding through this program. Additionally, AB 156 will allow individual property owners to apply for grants to offset the costs of connecting to an existing or proposed facility-based broadband provider.
The bill significantly modifies the focus of this existing grant program to broaden eligibility for funds. Projects funded through the Broadband Infrastructure Grant Account must focus on last-mile broadband access to households that are underserved or unserved by an existing facility-based broadband provider. “Underserved areas” include areas where there is no service provider offering at least one tier of broadband service with at least a 25 megabits per second download speed, 3 megabits per second upload speed, and a latency that is sufficiently low to allow real-time interactive applications.
Grant funds may be used to pay for costs directly related to the deployment of broadband infrastructure, costs to lease access to property (not to exceed five years), and costs incurred by an existing facility-based broadband provider to upgrade its facilities to provide for interconnection. Although the focus is on last-mile infrastructure, current guidelines for the Broadband Infrastructure Grant Account allow for funds to support middle-mile infrastructure if it is necessary for the deployment of last-mile infrastructure.
Federal Funding Account
Using $2 billion in funding through the American Rescue Plan Act (ARPA), AB 156 establishes a new subaccount under the CASF called the Federal Funding Account. These funds will also support last-mile broadband infrastructure.
Each county in California will receive a base allocation of $5,000,000. Remaining monies will be allocated based on each county’s proportionate share of California households without access to broadband internet service with at least 100 megabits per second download speeds. This formula funding above the initial base allocation will be determined based on the state’s Broadband Mapping Program data as of July 1, 2021.
Broadband Loan Loss Reserve Fund
If financing is an option for your organization, AB 156 also establishes the Broadband Loan Loss Reserve Fund to finance the deployment of broadband infrastructure by local government agencies and nonprofit organizations. Applications for low-interest, long-term loans will also be handled by the Public Utilities Commission.
Implementation and Funding Timeline
The passage and signing of AB 156 triggers several bureaucratic processes for the California Public Utilities Commission, which must be completed prior to the posting of solicitations for project proposals. Establishing the new Federal Funding Account will require the development and implementation of funding guidelines, which includes a public comment period. Additionally, the guidelines for the existing accounts will need to be revised to reflect the statutory changes made in AB 156. These processes typically take several months to complete.
Projects eligible for funding under AB 156 must deploy infrastructure capable of providing broadband service with a minimum of 100 megabits per second download speeds and 20 megabits per second upload speeds, or the most current minimum standard for broadband as defined by the Federal Communications Commission (whichever is greater). Funding through the Broadband Infrastructure Grant Account must be encumbered by December 31, 2026, and funding through the Federal Funding Account will be available through June 30, 2023.
It is never too early to start planning ahead! Competitive applications will need to identify underserved and unserved households in their project area that will benefit from the infrastructure investment, develop collaborations with the local service provider(s) to implement the project, and put together a project budget and timeline. Laying the groundwork for a future broadband infrastructure project now will put organizations in an advantageous position to capitalize on these historic funding opportunities.
If you would like to discuss these funding opportunities further with an expert grant writer, please feel free to reach out to RPPG at (916) 974-9270 or contact the Manager of Grant Writing and Research directly via email at email@example.com.