USDA announces $714M for rural broadband in 19 states

The US Department of Agriculture (USDA) on Monday announced it will award $714 million in loans and grants to 19 states for rural broadband projects. The funding comes from the USDA's ReConnect program, which supports broadband buildouts in unserved rural areas, and went primarily to local telcos and cooperatives.

Funding was awarded to providers for 33 projects in 19 states, including Alaska, Arkansas, Arizona, California, Georgia, Idaho, Kansas, Kentucky, Minnesota, Missouri, Montana, New Mexico, Ohio, Oklahoma, Oregon, South Carolina, Tennessee, Utah and Washington. All projects will deploy fiber-to-the-premises (FTTP) to connect last-mile, rural locations.

According to numbers released by the USDA, more than 83,600 people will be serviced by these buildouts, as well as 2,093 businesses, 4,705 farms and 97 educational facilities.

Roughly $421 million was awarded in grants, and approximately $293 million was awarded in loans. The largest grants went to Nemont Telephone Cooperative in Montana ($34.9 million) and Interior Telephone Company in Alaska ($34.9 million), and the largest loan went to Craw-Kan Telephone Cooperative in Kansas ($49.9 million).

The funding announced on Monday follows additional fourth round ReConnect funding announced in April, when the USDA awarded $40 million to three local providers in New Mexico.

'Internet for all'

The ReConnect program was established in 2018, under the Trump administration, but it received an additional $2 billion in the 2021 Infrastructure Investment and Jobs Act (IIJA), signed by President Biden. The IIJA also supplied over $60 billion in funding for broadband through the Broadband, Equity, Access and Deployment (BEAD) program, the Middle Mile fund and others.

Under the Biden administration, the ReConnect program has invested roughly $2.3 billion in 142 projects to bring broadband to 314,000 rural Americans thus far, according to the USDA. ReConnect received $4.3 billion in fourth round applications alone, said Andy Berke, Rural Utilities Service (RUS) administrator. Notably, while President Biden had proposed another $400 billion for ReConnect in his initial budget plan in March, the debt ceiling bill eventually passed without that funding.

On a call with reporters Monday afternoon, Berke stressed the ReConnect program's tight timelines and said construction on these projects will start following environmental reviews, which can take "anywhere from a few months to longer" depending on the complexity.

"But we already are seeing deployments from previous rounds where people are getting connected, subscribers are coming online. And that's making a real difference very quickly," he said.

Funding flurry

The fourth round of ReConnect grants comes amid a flurry of federal funding activity associated with the Biden administration, with grants from the $1 billion Middle Mile program set to be awarded and funding from the $42.5 billion BEAD program to be allocated in the coming weeks, by the projected date of June 30.

It also comes as the US Treasury Department announced recently that it has awarded roughly $6.7 billion of its $10 billion allotment through the American Rescue Plan for broadband infrastructure and related projects in 42 states, to reach an estimated 1.88 million locations with high-speed Internet.

According to the USDA, ReConnect applicants must provide service of at least 100/20 Mbit/s in rural areas that lack access to service at that level. As with other current federal broadband funds, they're also required to participate in the Affordable Connectivity Program (ACP), another IIJA program that is helping to subsidize broadband for over 18 million low-income households but is set to run out of funding next year without action from Congress.

Asked if the USDA is considering a backup option for ReConnect applicants if the ACP lapses, a senior administration official said only that the administration supports the ACP and is working on expanding participation.

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— Nicole Ferraro, editor, Light Reading, and host of "The Divide" on the Light Reading Podcast.