Treasury Announces First States to Get Capital Projects Funds

This morning, the Department of Treasury announced the first round of Capital Projects Fund (CPF) awards to states putting together portfolios to deploy new infrastructure to unserved households. Across Louisiana, New Hampshire, Virginia, and West Virginia, 200,000 locations will see new deployments capable of 100/100 Mbps at a total cost of almost $583 million. 

It’s a welcome announcement that should assemble a wide range of solutions and result in much better connections for more than half a million people across the country long left behind by policy and infrastructure solutions so far. It also marks those states which have been more proactive in getting their ducks in a row as early as possible, and opening a dialogue with Treasury about how to use the CPF funds expeditiously to solve remote work, healthcare, and education in the face of the ongoing publish health crisis.

The Basics

The CPF is made up of $10 billion, and part of the $1.9 trillion American Rescue Plan Act passed last year. It complements the $350 billion State and Local Fiscal Recovery Funds (SLFRF) (which can be used for water, sewer, or broadband infrastructure) as well as the Emergency Connectivity Fund (ECF). New infrastructure must be capable of delivering symmetrical speeds of 100 Mbps. There are no local matches required (though most states are and will likely institute some form of requirement).

CPF funds can go toward premises that lack access to 100/20 Mbps, as well as multi-dwelling unit solutions and improving access for community anchor institutions. The program requires awardees to participate in the Affordable Connectivity Program, for however long it lasts.

In total, it looks like for three of the four state plans announced this morning by Treasury, disbursed funds represent 100 percent of their CPF money. Collectively, they mean serving between 10 percent (West Virginia) and 50 percent (New Hampshire) of what the state considers its unserved locations at present. 

New Hampshire’s plan will bring service to 50 percent of the presently unserved locations, and as a welcome bonus prioritizes money to local government projects. This is unmistakably good; local governments know where the broadband problems lay, and how best to solve them.

A fuller breakdown from the Treasury announcement:

Louisiana, approved for $176.7 million (representing 100% of its available CPF funding), will provide funding to connect nearly 88,500 homes and businesses currently lacking access to Internet at speeds of 25/3 Mbps through the state’s the new Granting Unserved Municipalities Broadband Opportunities (GUMBO) program, a multi-phase, broadband infrastructure competitive grant program.  Louisiana estimates that projects receiving funding from this CPF award will close the digital divide for approximately 25% of all locations lacking high-speed Internet access in the state.

See the Louisiana Capital Projects Fund Fact Sheet here.

New Hampshire, approved for an initial award of $50 million (representing 41% of its available CPF funding), estimates it will serve 15,000 homes and businesses, in rural and remote areas, which represents approximately 50% of locations in the state that lack access to high-speed Internet. The state’s new Broadband Contract Program is designed to select and support a local Internet service provider (ISP) to provide Internet service to the most rural parts of the state lacking Internet service.  The program will prioritize applicants that encourage the maximum number of locations to be served at the lowest cost, and broadband networks that will be owned, operated by, or affiliated with local governments, non-profits, and co-operatives.   

See the New Hampshire Capital Projects Fund Fact Sheet here.

Virginia, approved for $219.8 million (representing 100% of its available CPF funding), will use funds to expand last-mile broadband access to an estimated 76,873 locations, approximately 28% of locations the state estimates lack access to high-quality broadband service. Through a competitive grant-making program overseen by the Virginia Telecommunication Initiative (VATI), local governments in partnership with Internet service providers apply for funds with the goal of deploying universal coverage solutions in the localities involved.

See the Virginia Capital Projects Fund Fact Sheet here.

West Virginia, approved for $136.3 million (representing 100% of its available CPF funding), estimates that projects receiving funding from this CPF award will serve 20,000 locations, or approximately 10% of locations in the state that lack access to high-speed Internet.  The state will use three separate grant programs that focus funding for last-mile connections to homes and businesses currently without access to Internet at speeds of at least 25/3 Mbps. The Line Extension Advancement and Development Program (LEAD) will fund the extensions of last-mile broadband networks that can be constructed quickly, the Major Broadband Projects Strategies Program (MBPS) will fund larger-scale projects designed to serve large numbers of eligible addresses, and GigReady will provide local governments with the opportunity to utilize SLFRF as matching funds for broadband infrastructure projects.  Each of these three programs is designed to enable funding to reach areas that are hardest to serve due to low population density, rurality, or other factors.

See the West Virginia Capital Projects Fund Fact Sheet here.

Down the Road

The remaining states have until the end of September to submit their plans to Treasury. The Department has been busy in recent months, already approving more than $5 million to dozens of Tribal governments to get new deployments started there as well.

For more on the Capital Projects fund, as well as how it will interact with the new BEAD funding, the SLFRF, watch or listen to the episodes of the Community Broadband Bits podcast or Connect This! Show below.

Breaking Down BEAD Funding Requirements with Nancy Werner - Episode 498 of the Community Broadband Bits Podcast