Treasury Helps Broadband for Everyone in Louisiana
Wednesday, June 8, 2022
Treasury Helps Broadband for Everyone in Louisiana
Louisiana is aiming to close the digital divide in the state by 2029. Getting there could cost over $1 billion. This week, the state partnered with the U.S. Department of Treasury to help reach that goal.
On June 7, Treasury approved Louisiana for $176.7 million of support from the Coronavirus Capital Projects Fund (CPF). The funding will help 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.
“The pandemic exposed longstanding challenges that workers and families face when they don’t have adequate access to the internet, especially those living in rural areas and other unconnected communities. That is why these broadband investments across the country are so critical,” said Deputy Secretary of the Treasury Wally Adeyemo. “This funding through the American Rescue Plan will help connect thousands of homes and businesses in Louisiana with affordable high-speed internet and help close the digital divide in communities where connectivity is needed most. Treasury commends Louisiana for targeting this funding to places where it is most urgently needed across the state.”
Louisiana's Digital Divide
Data from McKinsey & Company indicates there are several hundred thousand households throughout Louisiana that lack broadband access at speeds of 25 megabits per second download and 3 megabits per second upload. The Louisiana Office of Broadband Development & Connectivity, known as ConnectLA, aims to assist local leaders in identifying the extent of the problem locally and how they can use the available resources to their benefit. A third of rural Louisianans are without access to high-speed broadband. Louisiana is ranked 18th in access to gigabit internet by U.S. News & World Report and 33rd in access by BroadbandNow.
According to the Louisiana Survey, 75% of Louisiana adults have broadband internet service at home, six percent have internet but it isn't “high-speed” service, and 20% have no internet service at home. The survey also said 18% of residents don’t have internet service at home but own a smartphone and six percent have neither broadband service at home nor a smartphone. Of those without internet service at home, 54%, said they would like to have it, but 42% of Louisianans without internet service at home answered the survey saying they don’t have the service because it is not available where they live. Although broadband access is a great issue for residents, according to the survey, 64% said the cost was why they don’t have internet service.
In August of 2019, Gov. John Bel Edwards (D-LA) created the Broadband for Everyone in Louisiana Commission to facilitate private sector providers, public entities, and other broadband stakeholders to improve both the adoption and availability of broadband service for Louisiana residents. The state's goal is universal access to broadband service with minimum speed of 25 Megabits per second download and 3 Mbps upload, scalable to up to 100 Mbps download and 100 Mbps upload, for all Louisianians by 2029.
In the fall of 2020, the Federal Communications Commission awarded $342 million to 13 private internet service providers in Louisiana through the Rural Digital Opportunity Fund. This funding will provide broadband internet to a considerable number of residents over a six-year period. In addition, the state GUMBO grant program [see blow] will fund around $180 million for local providers to work with municipalities to build out broadband infrastructure. Between these two programs, Louisiana hopes to connect over 250,000 locations over the next five to six years.
Granting Unserved Municipalities Broadband Opportunities (GUMBO) is Louisiana’s multiphase broadband infrastructure competitive grant program. Launched earlier this year with $90 million the program received $440 million in funding requests from 23 companies. The proposals span 58 parishes and seek to provide high-speed Internet to 215,000 households and 14,000 businesses.
"The volume of applications we've received and the enthusiasm for broadband we've encountered from municipalities throughout the state reaffirms just how important our work is to Louisiana," said Veneeth Iyengar, executive director of ConnectLA.
GUMBO funds broadband infrastructure projects in areas that currently lack access to internet at speeds of 25/3 Mbps. GUMBO is designed to provide internet service with speeds of 100/100 Mbps symmetrical to households and businesses upon project completion.
GUMBO is designed to consider, through the project selection criteria, an applicant’s
- technical ability,
- financial wherewithal in successfully deploying and providing broadband service,
- matching funds percentage of the total cost of the project (GUMBO requires applicants put up at least 20% in matching funds, with points given to those that go beyond that threshold),
- support from local governments,
- estimated number of unserved households within the eligible economically distressed parish(1),
- percentage of the total unserved households within the eligible economically distressed parish that the project will newly and directly serve,
- provision of service to unserved businesses located within the eligible economically distressed parish,
- leveraging its own or nearby or adjacent broadband service infrastructure in the proposed project area,
- the ultimate price of broadband service to the consumer, and
- in-kind contributions or matching funds from a local government.
The Louisiana Office of Broadband Development & Connectivity's criteria also favor small business entrepreneurship.
Consistent with Department of Treasury guidelines, GUMBO- and CPF-funded projects, upon completion, must deliver reliable internet service that meets or exceeds symmetrical download and upload speeds of 100 megabits per second (Mbps). The projects will participate in the FCC’s Affordable Connectivity Program (ACP)—a $30 per month subsidy for low-income families.
The Louisiana Office of Broadband Development & Connectivity requires GUMBO-funded projects to:
- Offer service at speeds of at least 100/20 Mbps
- For grant recipients that offer broadband service to at least one thousand consumers for a period of at least five consecutive years, they must offer broadband service at prices consistent with offers to consumers in other areas of the state. For smaller projects, providers must ensure that the broadband service is priced to consumers at no more than the cost rate identified in the project application, for the duration of the five-year service agreement.
- At least annually, a grant recipient must offer service available at the proposed advertised speed, or a faster speed, as contained in the grant agreement.
- For the duration of the agreement, grant recipients shall disclose any changes to data caps.
"We are grateful to be recognized and given approval by the Deputy Secretary of Treasury Wally Adeyemo as one of the first four states to have our State Broadband Grant Program (GUMBO) plan formally approved," said Gov. John Bel Edwards. "The digital divide presents a great challenge to the people of Louisiana, but it’s a challenge that we will overcome. Today’s announcement is a testament to the pace at which our State Office of Broadband (ConnectLA) is working to develop first rate polices and plans to ensure everyone in Louisiana has access to affordable, high-speed internet."
Additional Federal Funding on the Way
Louisiana has indicated that it will also participate in the Broadband Equity, Access, and Deployment (BEAD) Program, overseen by the e U.S. Department of Commerce’s National Telecommunications and Information Administration (NTIA).
Gov. Edwards said, "Partnering with Commerce/NTIA will allow Louisiana to achieve what we thought was impossible. We will now have the financial resources necessary to once and for all eliminate the digital divide in Louisiana. We are grateful to both Secretary Raimondo and Assistant Secretary Davidson of NTIA for their leadership and partnership. Over the past several years, our Broadband Office (ConnectLA) has worked hard to align resources between federal, state, and local officials to take full advantage of this historic broadband funding opportunity. We look forward to partnering with the people of Louisiana to make closing the divide a reality."
- "Economically distressed parish" means an unserved area that is in need of expansion of business and industry and the creation of jobs, giving consideration to unemployment, per capita income, and the number of residents receiving public assistance within that unserved area.
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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