Understanding Government Infrastructure Funding: CARES, IIJA, CAA, ARPA

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In recent years, there has been an unprecedented rise in broadband infrastructure funding and support. A series of multi-billion-dollar bills have been passed which should result in a significant improvement in network expansion and access, countrywide. 

The CARES, ARPA, IIJA and CAA legislation can be confusing to navigate, however, with areas of overlap and different eligibility criteria.

We’ve broken it down the infrastructure spending into the main three bills, what each is intended for, who can access the funding, and who will benefit. Dollar amounts have been indicated wherever possible.

1: CARES – 2020 Coronavirus Relief Funds

Headline: Relief Package for Post-Pandemic Recovery

Amount of funding: $150 billion to State Governments

Intended for: Covering pandemic-related costs unanticipated in 2020-21 budgets

Current Status: Law

Passed by congress and signed into law in March 2020, President Trump’s $2.2 trillion Coronavirus Aid, Relief, and Economic Security Act included $150 billion to be granted to individual state governments to enable infrastructure improvements during the pandemic, with the intention of improving communication and information access. 

Several states so far have elected to use this money to develop their broadband networks including Delaware, Idaho, Kansas, Mississippi, New Hampshire, and South Carolina. In Mississippi, for instance, the Electric Cooperatives Broadband COVID-19 Act provided $75 million in local emergency broadband grants, while Connecting New Hampshire spent $50 million on a program to enable distance work and learning in underserved communities.

There has been some confusion over the allocation of funding to specific populations because the eligibility criteria are a little complex:

  • Local governments with populations of 500,000 or more are eligible
  • Local governments can claim up to 45% of their state’s total allocation.
  • Each state retains 55% for use at state level.
  • $3 billion is reserved for US territories and DC
  • A further $8 billion is earmarked for tribal governments.
  • A minimum guarantee of $1.25 billion is allocated per state.

To find out if your state offers such assistance under CARES legislation, here is a summary, courtesy of the National Conference of State Legislatures (NCSL). In terms of funding of broadband infrastructure, the abovementioned six states have taken a lead in developing new access programs. Other states may follow suit by upgrading existing infrastructure too.

2: IIJA – Infrastructure Investment and Jobs Act 2021

Headline: State-allocated infrastructure improvement.

Amount of funding: $42.45 Billion under the BEAD Program

Intended For: Developing infrastructure and access in underserved communities

Current Status: Law

Signed into law in November 2021, the Invest in America Act, as it’s colloquially known, is a bipartisan infrastructure bill which contains provision for a Broadband Equity, Access, and Deployment Program (BEAD).This program aims to address some of the inequities in broadband internet access across the US

An initial tranche of $100 million will be given to each US state, following which the FCC will issue coverage priority maps which will inform subsequent funding rounds. To receive their allocation of funding, each state is required to submit a five-year plan identifying priority regions, as well as indicate timescales for network deployment.

At the state level, grants will be made available to private developers, public-private partnerships, non-profit organizations, cooperatives, local governments, and utilities. 

In full, here are the criteria each applicant must fulfil:

  • Commitment to deliver broadband speeds of 100 Mbps (download) and 20 Mbps (upload).
  • Provision of at least one discounted service plan for consumers.
  • Network deployment and broadband provision to be completed within four years.
  • No more than 5% of the money can be used for administrative purposes.

In addition, it’s important to consider the criteria for underserved communities. In the Act, areas are considered underserved if their networks provide maximum 25 Mbps download and 3 Mbps upload speeds. The BEAD’s aims constitute a significant improvement in provision, but it does leave a gray area for regions who currently achieve network speeds between these two extremes.

The 5% administration allocation can be used for data collection, research, and the identification of underserved areas, as well as the onboarding and training of network employees and community outreach programs.

Within the infrastructure bill there are additional broadband initiatives including:

Congress gave the National Telecommunications and Information Administration (NTIA) 180 days to institute the BEAD program. NTIA ha until the end of May 2022 to begin disbursing funds, although this deadline could potentially be extended, particularly if there are delays from the FCC in distributing its maps of insufficient provision.

3: ARPA – American Rescue Plan Act, 2021.

Headline: An additional recovery fund to build upon CARES provision.

Amount of Funding: $350 billion for ALL recovery funding.

Intended For: helping to help states recover and initiate new infrastructure projects.

Current Status: Law

As well as billions of dollars of Fiscal Recovery Funds for states, the ARPA bill signed into law in March 2021 created two individual funds which may help with broadband deployment countrywide.

ECF – Emergency Connectivity Fund

The first is the Emergency Connectivity Fund (ECF), a $7.2 billion pot administered by the FCC to help schools and libraries to upgrade their hardware, with the intention of easing the transition to remote or hybrid learning. Hardware eligible under this provision includes routers, WiFi hotspots and tablet computers, but money could also be spent enhancing local broadband provision, or even setting up private LTE or other localized networks where this would provide the best service.

An application window for the ECF opened between June-August 2021, and the FCC approved $1.2 billion of funding requests (less than ¼ of the applications it received, which totaled $5.14 billion). A second application window opened between September 28th and October 13th 2021. In this second tranche of funding, a further $1.1 billion was disbursed.

Further disbursements totaling $1.6 billion were paid out monthly between November 2021 and February 2022. The program has so far benefitted 10,800 schools and 875 libraries, as well as 125 consortia.  Almost ten million devices have been connected to new or improved networks, with more than 4.9 million new broadband connections achieved.

Capital Projects Fund

The second program within ARPA’s connectivity measures included the Capital Projects Fund (CPF) which can be used by states, tribes, or territories for capital investment in infrastructure improving work, health, or education. $10 billion was earmarked for this purpose.

Encouragingly, fiber optic networks were specifically recommended in September 2021 as well as “broadband networks owned, operated by or affiliated with local governments, non-profits, and cooperatives”.

Eligibility criteria for this program were issued by the US Treasury, which stated that one of the program’s key priorities was to “ensure that all communities have access to the high-quality modern infrastructure, including broadband, needed to access critical services”.

The ultimate aim, the Treasury guidance notes, is to “contribute to the Administration’s goal of providing every American with the modern infrastructure necessary to access critical services, including a high-quality and affordable broadband internet connection.”

The main deadline to request funding was December 27th 2021, although tribal governments have until June 1st 2022 to submit their applications. 

Full Treasury guidance is available here.

An NCSL summary of ARPA awards given can be found here.

4: The Consolidated Appropriations Act (CAA), 2021

Headline: Two programs to support public broadband connectivity.

Amount of funding: $3.5 billion to individual organizations.

Intended for: Promoting increased broadband access in underserved and minority communities.

Current Status: Law

In December 2020 this $2.3 trillion spending package included an Emergency Broadband Benefit (EBB) Program worth $3.2 billion aimed at providing a monthly discount to eligible households to support their connection to broadband services. As of August 2021, more than five million households have enrolled in the scheme. 

The eventual intention is to transform the EBB into an annual Affordable Connectivity Program with an extra $14.2 billion of funding.

This Act also initiated a Broadband Infrastructure Program, administered by the NTIA to help underserved areas deploy broadband networks. Applications were available between May and August 2021 and $277 billion of grants have been allocated to date. So far, over 133,000 locations in more than a dozen states have benefited.

Finally, this Act included the Connecting Minority Communities Pilot Program, with $285 million set aside to help historically Black and tribal schools and universities, businesses and non-profits with connectivity and hardware costs. The application window was open between August and December 2021 and the NTIA 

Summary

These four Acts together constitute a significant package of measures targeted towards improving America’s broadband internet provision, thereby keeping the country online and competitive. While some provisions aim to address inequalities, the overall funding mix should permit a complete overhaul of currently ailing networks. If we have one thing to thank COVID-19 for, it is accelerating these all-important infrastructure changes.

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