Treasury's Capital Projects Fund Boosts Maryland's Network Infrastructure Grant Program
Friday, July 15, 2022
Treasury's Capital Projects Fund Boosts Maryland's Network Infrastructure Grant Program
"Our goal is to ensure universal broadband to everyone in every single corner of the state."—Maryland Governor Larry Hogan
Maryland wants broadband networks to reach everyone in the state. Its efforts got a boost this week when the U.S. Department of the Treasury approved the state's plan to apply 55% of its allocation from the Capital Projects Fund towards broadband deployment.
The Digital Divide in Maryland
The Federal Communications Commission estimates that just 2.6% of Marylanders lack access to broadband networks that can deliver speeds of 25 Mbps downloads and 3 Mbps uploads. The number is higher for Maryland's rural areas where 7.1% of residents do not have broadband access. BroadbandNow estimates that less than 63% of people in Maryland have access to fiber-based broadband networks and less than 22% are able to purchase broadband for $60/month or less.
In 2021, the Abell Foundation published Disconnected in Maryland: Statewide Data Show the Racial and Economic Underpinnings of the Digital Divide, written by Benton Senior Fellow John B. Horrigan. The report accessed the state of digital equity in Maryland, analyzing adoption for home wireline internet service and computing devices. Horrigan found:
- Some 520,000 Maryland households did not subscribe to wireline broadband service at home. That came to 23% of homes lacking service.
- Approximately 391,000 Maryland homes did not have a desktop or laptop computer, or 18% of all households.
- Close to 290,000 Maryland households had neither a desktop, laptop, nor tablet computing device in their homes. That is 13% of households without these digital access tools.
Gaps in the adoption of digital tools fell heavily along three (non-mutually exclusive) categories:
Two-thirds of Maryland households lacking digital tools such as home wireline broadband connections and computers lived in the state’s metropolitan counties or Baltimore City.
Baltimore, the state’s largest city, was both densely populated and had a low home wireline adoption rate. In Baltimore, some 41.3% of households did not subscribe to wireline internet and one-third (31.9%) lack a desktop or laptop computer. Some 26.1% had neither a desktop, laptop, nor tablet, well below 12.9% figure for the state.
Densely populated counties in metropolitan areas: Some 19.3% of all households in these areas did not have a wireline subscription and 14.0% lacked a laptop or desktop computer. One in ten (9.7%) did not have a desktop, laptop, or tablet computer. These counties (60% of the state’s households) are: Anne Arundel, Baltimore County, Howard, Montgomery, and Prince George’s.
Rural counties whose incomes were below the state average: Collectively, 33.6% of homes in these areas did not subscribe to high-speed service (below the 23.3% figure for the state) and 25.5% lacked a desktop or laptop. Some 19.4% had neither a desktop, laptop, nor tablet device in the home. (The counties in this category are Allegany, Caroline, Cecil, Dorchester, Garrett, Queen Anne’s, Somerset, Talbot, Washington, Wicomico, and Worcester.)
Rural counties with above-average household incomes: In these counties, 22.2% of households did not have a home high-speed subscription (slightly less than the state’s overall figure) and 14.5% did not have a desktop or laptop computer. One in ten (10.9%) lacked a desktop, laptop, or tablet computer. (The counties are Calvert, Carroll, Charles, Frederick, Harford, and St. Mary’s.)
Forty percent of all Marylanders without wireline broadband, or 206,000 households, were African American and the figures were similar for computer ownership of any kind (i.e., desktop, laptop, or tablet). For African American and Latino Marylanders, home wireline broadband and computing devices were scarce relative to Whites and Asian Americans. One-quarter (25.6%) of Latinos did not subscribe to high-speed service at home and 29.5% of African Americans did not. For Asian Americans and Whites, the numbers were 14.0% and 20.5%, respectively. The pattern was similar for desktop or laptop computers, as 25.6% of Latinos and 23.8% of African Americans did not have them; 14.1% of Whites and 7.7% of Asian Americans did not.
Marylanders living in the poorest households were about half as likely to have wireline broadband at home than high-income households. Overall, nearly three-quarters of all disconnected Maryland households were those below the state’s median income. More than half (53.2%) of low-income households (those whose annual incomes are below $25,000) lacked wireline broadband at home and about half (47.9%) did not have a desktop or laptop computer. In some areas, gaps were more severe. In Baltimore City, two-thirds (68.2%) of low-income households did not subscribe to wireline broadband. In lower-income rural counties, 57.8% of low-income households did not subscribe to service.
Broadband Programs in Maryland
In August 2021, Governor Larry Hogan (R-MD) launched Connect Maryland, a statewide investment in closing the digital divide. “The State of Maryland has set an ambitious goal of ensuring universal broadband to everyone in every single corner of the state by no later than 2025," said Gov. Hogan. Connect Maryland includes $400 million In broadband funding. Maryland decided to invest $300 million in federal funding from the American Rescue Plan Act to expand broadband access across the state. Connect Maryland includes an additional $100 million.
The Maryland Network Infrastructure Grant Program is intended to provide financial assistance to internet service providers to construct broadband infrastructure necessary to provide symmetrical 100 Mbps service in areas where broadband service does not currently exist. Grant funds may be used to construct infrastructure necessary to deploy service to residents, businesses and anchor institutions. Grants are awarded on a competitive basis.
In a call for Network Infrastructure Grant Program applications issued in 2021, Maryland made $75 million available for grants of between 70% and 90% of the capital construction costs for major broadband infrastructure projects depending on the projects composition. The applicants were expected to serve significant areas of unserved households and businesses. Grants provide between $1 million and $10 million to local jurisdictions or their internet service provider partners.
On July 8, 2022, Gov. Hogan announced nearly $100 million in Network Infrastructure Grant Program awards (see awards here). Comcast, the nation's largest broadband providers, won awards for projects in Baltimore and Charles counties; Charter gained support for a project in Somerset County; and Atlantic Broadband will extend service in Queen Anne's County. But smaller providers also won awards including Choptank Electric Cooperative, Maryland-based Quantum, fiber-operators Talkie and ThinkBig, and municipal-owned Easton Utilities.
On July 14, 2022, the U.S. Treasury approved Maryland's plan for $95 million in Capital Projects Fund support. Maryland estimates it will connect 16,667 homes and businesses through its competitive broadband grant program. The program aims to close the racial and socioeconomic digital divide across the state. As reported by Maryland, estimates show that investments made using the Capital Projects Fund will serve approximately 30% of locations still lacking high-speed internet access in the state. The operators of Maryland networks that receive Capital Projects Fund support will still be responsible to contribute matching funds, provide internet service with speeds of 100/100 Mbps symmetrical to households and businesses upon project completion, and participate in the Federal Communications Commission's Affordable Connectivity Program, a $30 per month subsidy for low-income families.
More in this series
American Rescue Plan Fuels Virginia's Universal Broadband Efforts
Treasury Helps Broadband for Everyone in Louisiana
Capital Projects Fund Aids West Virginia's Billion Dollar Broadband Strategy
Broadband is the Future of New Hampshire
U.S. Treasury Helps Accelerate Broadband Deployment in Kansas
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