Capital Projects Fund Aids West Virginia's Billion Dollar Broadband Strategy
Thursday, June 9, 2022
Capital Projects Fund Aids West Virginia's Billion Dollar Broadband Strategy
In October 2021, Governor Jim Justice (R-WV) announced a billion-dollar strategy to bring broadband access to 200,000 homes and businesses in West Virginia. “We’ve been talking for years about how to fix the rural broadband problem. Now we’re finally going to do it," he said.
The plan got a $136 million boost from the U.S. Department of Treasury on June 7, 2022. The funding will help expand high-speed broadband to 20,000 locations—10 percent of locations in the state that lack access to broadband.
The American Rescue Plan provides $10 billion for payments to eligible governments to carry out critical capital projects that directly enable work, education, and health monitoring, including remote options, in response to the public health emergency. The Coronavirus Capital Projects Fund (Capital Projects Fund) will help ensure that all communities have access to the high-quality modern infrastructure needed to access critical services, including broadband.
“I could not be any more appreciative of the Treasury for making our West Virginia Coronavirus Capital Project Fund one of the first four such plans approved,” said Gov. Justice. “Now it’s up to us to put these funds to good use bringing more of our communities into the 21st century and opening the door to a brighter future for our people.”
“Approval of our plan, modeled after many of our Legislative proposals for internet expansion funding, is a very welcome development,” said Delegate Daniel Linville (R-Cabell), chairman of West Virginia's House Technology and Infrastructure Committee. “The task now is deploying these dollars quickly and with accountability.
West Virginia's Digital Divide
According to Federal Communications Commission data, at least 30 percent of West Virginia’s rural homes and businesses currently lack adequate broadband access, leaving the state with one of the nation’s lowest broadband connectivity rates. But the state's digital divide is not just a rural problem: Tufts University's Bhaskar Chakravorti estimates that 62 percent of urban West Virginia does not use the internet at broadband speeds.
Broadband expansion in West Virginia has been hindered, in part, by the cost of extending networks into mountainous rural areas. Another challenge is low population density with large distances between communities and anchor institutions.
"How do we tame the vast and challenging wilderness of our mountains and valleys as our forefathers once did while respecting their beauty and natural resources?" said State Delegate Linville.
The Billion Dollar Broadband Strategy
Gov. Justice’s strategy will combine funding from federal, state and local sources as well as private-sector partners. A total of $718 million in government funding is expected to be invested in broadband in the state this fall. With private-sector funds, the total investment is expected to exceed $1 billion.
West Virginia has the highest rate of Rural Digital Opportunity Fund (RDOF) support per capita at $202 per person: the Federal Communications Commission awarded broadband providers in the state $362 million to expand broadband networks into unserved areas. RDOF funding will be complemented by private investment from participating ISPs to create a minimum expected RDOF impact of $500 million. The program is expected to provide broadband availability to approximately 119,000 homes and businesses over five years.
The West Virginia State Broadband Initiative, operated by the state Office of Broadband and Broadband Council, is supported by a mix of federal and state funding. In addition to the $136 million from the Capital Projects Fund, the state allocated $90 million from American Recovery Plan Act State Fiscal Recovery funds for broadband projects, along with a $10 million appropriation of state general revenue funds for wireless broadband projects. These sources will provide $236 million in combined funding.
West Virginia's initiative comprises four award programs, each of which will allocate funds through a competitive application process:
- Line Extension Advancement and Development (LEAD): The LEAD program will award competitive grants to broadband providers to expand existing fiber and cable networks.
- GigReady Initiative: Local governments in West Virginia have been allocated more than $500 million from the American Rescue Plan Act Local Fiscal Recovery Fund, and many of them intend to invest that money in local broadband expansion. The GigReady Initiative will provide matching state funds for local governments that develop projects to pool their broadband investments.
- Major Broadband Project Strategies (MBPS): The MBPS program will focus on large-scale multicounty projects that require additional resources to achieve rapid implementation.
- Wireless Internet Networks (WIN): The WIN program will use $10 million in state general revenue funds to expand and improve existing wireless internet networks. Wireless networks are a specialized solution useful in remote or sparsely populated areas that are difficult to reach with fiber optic cable. Funding decisions will be made through early 2022.
All four components of the state-based program will competitively score applications from prospective funding recipients and will award funds based on evaluations by independent national broadband experts. Evaluation criteria include matching-fund contributions, speed to market, technical feasibility, and digital equality (providing service to underserved areas and populations). Participating broadband providers will be required to include a low-price service tier that is affordable for lower-income West Virginians.
Per Department of Treasury guidelines, West Virginia will fund projects that provide service that reliably meets or exceeds 100/100 Mbps speeds and will require service providers to participate in the FCC’s Affordable Connectivity Program (ACP), a $30 per month subsidy for low-income families.
West Virginia is expected to receive an additional $100 million for broadband as part of the Infrastructure Investment and Job Act's Broadband Equity, Access, and Deployment (BEAD) Program overseen by the U.S. Department of Commerce's National Telecommunications and Information Administration (NTIA). West Virginia has already indicated that it will participate in the BEAD Program.
“As Governor of the State of West Virginia, I have made broadband a top priority by launching West Virginia's Billion Dollar Broadband Strategy.," said Gov. Justice. "I am absolutely committed to ensuring that every West Virginian has access to high-speed internet connectivity. The Broadband Equity, Access and Deployment (BEAD) Program will help us achieve that goal. We look forward to working with the U.S. Department of Commerce, NTIA, and many stakeholders throughout West Virginia to implement this historic program. I have directed the West Virginia Department of Economic Development and its Office of Broadband to make sure that broadband connectivity is available everywhere throughout our great state. Working together, we will achieve internet connectivity for all West Virginians.”
Kevin Taglang is the executive editor at the Benton Institute for Broadband & Society.
The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.
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