Treasury Empowers Iowa's Push for Universal Broadband Access

Benton Institute for Broadband & Society

Friday, December 2, 2022

Weekly Digest

Treasury Empowers Iowa's Push for Universal Broadband Access

 You’re reading the Benton Institute for Broadband & Society’s Weekly Digest, a recap of the biggest (or most overlooked) broadband stories of the week. The digest is delivered via e-mail each Friday.

Round-Up for the Week of Nov 28 - Dec 2, 2023

Kevin Taglang

Over the years, Iowa's demand for broadband infrastructure far outstripped the funding the state has been willing to supply. But the state is allocating millions in federal funding to help it reach its broadband goals. The latest funding comes from the U.S. Treasury's Capital Projects Fund. Iowa is using over $150 million from the American Rescue Plat Act program to bring fiber to the farmland.

Iowa's Digital Divide ranks Iowa 45th in the nation in broadband access and finds that the state has the second-slowest internet speed nationwide, with an average download speed of 78.9 megabits per second (Mbps). About 35 percent of Iowa households lack access to the internet at download speeds of at least 25 megabits (Mbps) and minimum upload speeds of 3 Mbps. About one-third of Iowa’s counties are still broadband deserts, where high-speed internet is rarely offered, and only 18.5 percent of Iowans have access to affordable internet plans, well below the national average of 50.1 percent.

Iowa's Broadband Plan

On June 18, 2020, Governor Kim Reynolds (R-IA) established the Governor’s Economic Recovery Advisory Board to learn from the challenges and innovations of Iowans in response to the COVID-19 pandemic and to focus on modernizing Iowa’s economy. The governor challenged the Advisory Board to work across all areas of state government to deliver an effective and efficient plan for rebuilding the economy.

The 15-member advisory board unanimously recommended 18 initiatives, including "Make Iowa a Global Leader in Broadband." Specifically, the advisory board recommended a funding increase of $80-100 million per year for broadband infrastructure and adoption for the next five years, with grant matching ranging from 50-75 percent. To build this network, the board estimated, it may cost an average of $8,000 - $10,000 per location for a total of $810 million. (This estimate did not include the cost for locations already with 25/3 speeds that need to be upgraded to 100/100 or greater.)

To accomplish this goal, the board said strong state support would be required in the form of matching grants ranging from 50-75 percent. The recommendation was for the Iowa State Legislature to authorize broadband funding of $80-100 million per year for the next five years. But the board cautioned that this would not necessarily guarantee the 2025 goal of 100/100.

The board highlighted the lack of significant funding for the Empower Rural Iowa Broadband Grant Program and suggested a bond offering to raise the needed funds and using a dedicated source such as the Rebuild Iowa Infrastructure Fund budget or 1/8th of the Invest in Iowa sales tax. 

The board also recognized that access isn't the only barrier to universal broadband in Iowa—so is affordability. While Iowa created its Low-Income Home Energy Assistance Program for those who struggle to afford utilities, the board highlighted that the importance of internet access has shifted to be as vital as electricity and running water to perform basic daily tasks due to the even larger necessity for adequate internet access due to COVID-19. "Financial barriers should not exist for broadband access given the importance of distance learning, telework, and telehealth that accompany the paradigm shift at all levels of society." said the board, which then recommended the state subsidize low- to no-cost broadband access to negate the financial barriers to adoption. 

The board recommended increased job training for occupations relating to the broadband sector to increase the skilled labor force to implement infrastructure. The state should harness public-private partnerships to create educational opportunities from high schools, up to and including mid-career workers, to transition into high-demand information technology occupations centered around broadband implementation and adoption of technology in Iowa.

Addressing Iowa's woeful broadband access speeds, the board recommended enhancing mobile broadband by increasing individual user experience data download and upload rates of a minimum of 100 Mbps and decreasing end-to-end latency speeds to 1 ms or less.

Deployment of broadband by public-private partnerships in Iowa will require greater flexibility than what currently exists for the development of revenues for cities. The board asked the legislature to consider future requests for new and flexible funding ideas.

The board suggested the state identify the educational needs of broadband services and application services (e.g., help desk, online learning, telehealth) and meet the educational needs of broadband and application services through comprehensive mechanisms such as e-skills training, help desk, broadband mapping crowd-source training, and leveraging statewide resources such as K-20 institutions, libraries, cities, counties, community centers, and volunteer programs.

Finally, the board asked the state to explore new and emerging technologies like smart cities, smart fields, and low-earth orbit satellites.

Empower Rural Iowa Broadband Grant Program

Iowa's Office of the Chief Information Officer administers the Empower Rural Iowa Broadband Grant Program designed to reduce or eliminate areas of the state that are unserved or underserved by broadband service, leveraging federal funds and public and private partnerships where possible. The program does this by awarding grants to communications service providers that reduce or eliminate targeted service areas by installing broadband infrastructure that facilitates broadband service in targeted service areas.

The program is part of the Empower Rural Iowa initiative, which was established by Gov. Reynolds through an executive order in 2018. The state legislature allocated $1.3 million to the program that same year. 

In light of the Governor’s Economic Recovery Advisory Board recommendations, in 2021 Gov. Reynolds proposed:

  • A $450 million investment by the state into the program 
    • An annual investment of $150 million for 3 years with grant matching ranging from 35-75 percent. 
  • Incentivizing broadband providers to expand service in Iowa with the slowest speeds by covering 75 percent of project cost for targeted service areas lacking access to 25/3 broadband. 
    • Gov. Reynolds suggested a new tiered system to scale the state’s covered cost depending on the current speed in an area with areas with access to 25-50 Mbps broadband receiving 50 percent and areas with 50-80 Mbps broadband receiving 35 percent.
  • Requiring all providers to install at least 100 Mbps download and upload service for all projects that receive grant funding.

Iowa’s state budget allocated $100 million for the program for fiscal year 2022, which started July 1, 2021. As noted above, Gov. Reynolds originally had asked for $150 million annually for each of the next three years, but agreed to $100 million, saying she could get federal funds to supplement the remaining cost. After applications for the program were received, Gov. Reynolds announced that due to an overwhelming need and interest in the program, the state would spend about $200 million from American Rescue Plan funding on the program. The state had received 178 applications requesting a total of $300 million in funds. Communications service providers, including telecommunication companies and local governments, could apply for up to 60 percent of their broadband project costs in eligible areas of the state.

In September 2021, 39 applicants were awarded a total of $97.500 million for broadband infrastructure projects. At the same time, Gov. Reynolds and the Office of the Chief Information Officer promised to expedite a new grant opportunity utilizing American Rescue Plan Act federal funds to build upon the $100 million in state funding for this grant program. 

On January 4, 2022, the Iowa Office of the Chief Information Officer awarded $210,454,219.13 million in American Rescue Plan Coronavirus State and Local Fiscal Recovery Funds to expand access to broadband in Iowa. Matching funds brought the total investment to $526 million for 160 applicants to connect 39,000 homes, schools, and businesses.

On December 1, 2022, the U.S. Treasury approved Iowa's plan to use $152.2 million Capital Projects Fund support for broadband infrastructure. Iowa estimated the support would help connect 18,972 households and businesses—representing approximately 16 percent of locations in the state still lacking high-speed internet access. Funding will flow through the competitive Empower Rural Iowa Broadband Program. Using a three-step process, the program combines mapping data, input from communities, and applications from service providers. 

The $152.2 million is Iowa's full Capital Projects Fund allocation through the American Rescue Plan Act.

Federal Funding for More Planning

Last month the National Telecommunications and Information Administration awarded Iowa over $5.7 million to plan for the deployment and adoption of affordable, equitable, and reliable high-speed Internet throughout the state. Iowa received $5 million to fund:

  • Assessments of the impact of the barriers to accessing reliable high-speed Internet service;
  • Increasing capacity and staffing of Iowa's broadband office;
  • Education and assistance to Iowa communities wishing to communicate their high-speed Internet access needs.

In addition, Iowa received $708,924.00 to fund:

  • Hiring one full-time staff member to coordinate and lead Iowa's digital equity planning activities; 
  • Creation of an Iowa Digital Equity plan;
  • Engagement with community anchor institutions, local governments, tribal communities, and non-profits to establish a vision for digital equity and digital inclusion.

Quick Bits

Weekend Reads (resist tl;dr)

ICYMI from Benton

Upcoming Events

Dec 6—The Link Between Digital & Financial Inclusion: Tips for High-Impact Partnerships that Build Digital Skills & Wealth (EveryoneOn)

Dec 6—Fireside Chat With Federal Communications Commission and Telecommunications for the Deaf and Hard of Hearing

Dec 7—Executive Session to Consider Nominations (Senate Commerce Committee)

Dec 7—How Does the Data Divide Impact Global Policy Challenges? (Center for Data Innovation)

Dec 8—Technological Advisory Council Meeting (FCC)

Dec 8—How Should the FTC Address Deceptive Endorsement Advertising Online? (Center for Data Innovation)

Dec 8—Using Interactive Data to Inform Local Broadband Strategies (Next Century Cities)

Dec 16—ACP Outreach Grant Program Office Hours (FCC)

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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Kevin Taglang

Kevin Taglang
Executive Editor, Communications-related Headlines
Benton Institute
for Broadband & Society
1041 Ridge Rd, Unit 214
Wilmette, IL 60091
headlines AT benton DOT org

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