NTIA issues guidance on using BEAD funds for FWA, LEO

The NTIA has proposed new guidance to help clarify when states and territories can fund "alternative technologies" through the Broadband Equity Access and Deployment (BEAD) program in the hardest-to-reach locations.

The guidance is now open for public comment through midnight ET on September 10, 2024.

The NTIA's notice follows years of pushback from wireless advocates on the federal program's fiber focus, ongoing since the NTIA released its notice of funding opportunity for BEAD in mid-2022. It also comes as some states are just beginning to open their BEAD application portals.

The details

In a blog post about the new guidance, Evan Feinman, NTIA's BEAD program director, reiterated that fiber is still "the gold standard" and that fiber builds remain the "priority broadband projects for BEAD." Further, he confirmed that if fiber is too expensive, the next priority would be other "reliable" technologies, like "coaxial cable or licensed fixed wireless," rather than "alternative" technologies, like unlicensed fixed wireless access (uFWA) and low-Earth orbit (LEO) satellite.

It's in the "small percentage of locations, in the hardest-to reach-parts of the country" where these "alternative technologies" may be considered, added Feinman.

On that front, the NTIA's new guidance seeks to clarify some key issues.

Related:BEAD applications are open in Louisiana, Montana

First, it clarifies that BEAD funds cannot go toward funding alternative technologies in areas already served (or with existing plans to be served) by uFWA or LEO satellite, if those existing alternative technology solutions are already achieving BEAD speed and latency requirements.

Secondly, it clarifies when alternative technologies may be awarded: "Eligible Entities may select a proposal for an Alternative Technology only where there is no Reliable Broadband Service technology meeting the BEAD Program's technical requirements that would be deployable for a subsidy of less than the [extremely high-cost per-location threshold] EHCPLT at a given location. In such cases, an Eligible Entity is authorized to select a proposal involving a less costly technology for that location, even if that technology does not meet the statutory definition of Reliable Broadband Service but otherwise satisfies the BEAD Program's technical requirements," states the NTIA's guidance.

The NTIA further outlines that alternative technology proposals must address affordability by including any additional upfront consumer costs: "One-time initial costs such as installation and customer premises equipment are eligible uses of BEAD funds, and including these costs in the subgrant will help ensure installation and equipment costs are not a barrier to adoption for those Americans residing in BSLs served by Alternative Technologies funded through the BEAD program," states the NTIA.

Related:The Divide: Grading state BEAD plans with ITIF's Jessica Dine

The proposal also gives guidance on the use of LEO satellite services, which are permitted as alternative technologies for BEAD – unlike geostationary (GEO) satellite services, which are not BEAD-eligible. Specific to LEO use, the NTIA said it will provide "additional flexibility to use BEAD funds for the reservation of network capacity to meet the capacity requirement" of the program, under certain conditions.

For example, the NTIA said it will require that states/territories "apply a period of performance for any LEO Capacity Subgrant that concludes ten years after the date" of service. LEO service must also be available "not later than four years from the date of the subgrant."

And the NTIA proposes that states "reimburse recipients of LEO Capacity Subgrants only for the amount of capacity actually used, such as by reimbursing based on the number of actual subscribers to the broadband service in the project area in a period of time (e.g., month or year) multiplied by the per [broadband serviceable location] BSL cost of capacity."

The NTIA is accepting feedback on its guidance via email at [email protected].

WISPA 'pleased'

In response to the NTIA's guidance, the Wireless Internet Service Providers Association (WISPA), which has been pushing back on BEAD's fiber focus and rejection of uFWA as a "reliable" technology, released a statement saying the group is "pleased" with the NTIA's position.

One concern for WISPA has been that BEAD providers would "overbuild" areas already served by fixed wireless providers – an issue which NTIA clarifies in this new guidance, at least when it comes to other alternative technology projects.

"The expense and lag to deployment of fiber have caused states to recognize the need for more flexibility in the program, a view WISPA shares. Alternative technologies can cost-effectively, rapidly, and reliably go where fiber economically cannot. NTIA's recognition that areas where uFWA and LEOs are already providing service and areas funded by government programs should be off the table for BEAD is a welcome instruction that states cannot afford wasteful overbuilding," Steve Schwerbel, state advocacy manager at WISPA, said in a statement, adding that the group would also file comments on the matter.

BEAD approvals rolling

As of this writing, there are still 20 states/territories awaiting NTIA approval on volume two of their initial BEAD proposals. Other states, including Louisiana and Montana, have begun launching their BEAD grant application portals.

In its notice on alternative technology use, the NTIA said states with approved BEAD plans may be able to update those plans given the clarified rules.

"Any Eligible Entity that received NTIA approval of Volume II of its BEAD Initial Proposal prior to the publication of this updated guidance and that wishes to modify its Volume II or Initial Proposal Funding Request to reflect this updated guidance should contact its Federal Program Officer for direction," said the NTIA.

There is already evidence some states intend to dip into alternative technologies like LEO satellite for BEAD. For example, Louisiana, which opened its BEAD application portal last week, lists SpaceX, which operates Starlink, among its 33 pre-approved providers for the program.