Comments to NTIA Regarding Permissible Use of BEAD Nondeployment Funds

The Information Technology and Innovation Foundation (ITIF) appreciates the opportunity to provide input on NTIA guidance regarding permissible use of BEAD nondeployment funds. First, both the statute and the Assistant Secretary recognize the purpose of BEAD is to close the digital divide, so BEAD nondeployment funds should address the leading causes of the digital divide, namely barriers to home broadband adoption which includes affordability.1 NTIA’s Benefit of the Bargain Round and tech-neutral reforms were a success, and they enable BEAD to close home broadband deployment gaps while creating a substantial pool of nondeployment funds. NTIA should guide these funds toward focused, targeted uses that address nondeployment causes of the digital divide, unlike broader and more open-ended affordability programs such as ACP.2 Providing states guardrails within which to operate targeted, consumer-focused voucher programs for truly low-income households who need and want support will maximize BEAD’s chances of closing the digital divide. Second, while there may be beneficial uses of nondeployment funds beyond addressing adoption barriers, such as affordability, some parties have suggested uses of funds for which NTIA should carefully consider the tradeoffs.

• NTIA should not permit BEAD funds to subsidize things that would otherwise be profitably accomplished by private parties.
• Some parties proposed reserving nondeployment money for potential defaults or new locations. NTIA should be cautious about adopting such proposals. 
• State and local permitting processes can be a significant barrier to broadband deployment, but NTIA should ensure that nondeployment funds do not subsidize inefficiency or red tape. 
•  NTIA should reject calls to not use nondeployment funds and instead claw them back from states.