CSAC Bulletin Article

Broadband Progress Update: Where do the historic investments to close the Digital Divide stand now?

Tied by strict federal funding deadlines, California agencies are working swiftly to implement the historic $6 billion investment in broadband infrastructure. CSAC staff have provided an overview of the progress of these investments to date, as well as important funding opportunities for counties in the near future.

Middle-Mile Broadband Initiative:

SB 156 dedicated $3.25 billion to develop, construct, and maintain a statewide, open-access middle-mile network. Because funding for the middle-mile network comes from the federal American Rescue Plan Act (ARPA), all $3.25 billion must be dedicated by December 2024 and middle-mile projects must be completed by December 2026.

Last November, the California Department of Technology (CDT) announced the start of pre-construction and design work on 18 initial project locations. CDT is currently working on a competitive procurement for 3,000 miles of fiber and other materials, which Caltrans will start incorporating into existing transportation construction projects by July. However, the majority of projects are not expected to break ground until 2023. CDT anticipates the design of the 6,000-mile network to be finalized by July, but a preliminary map is available.

The Middle-Mile Advisory Committee, which oversees the development and construction of the middle-mile network, continues to meet monthly. Unfortunately, the February 18 Committee meeting fell victim to “Zoom bombing,” forcing the meeting to end early due to highly offensive content. The next meeting will be on March 18.

Last-Mile Initiative:

SB 156 also dedicated $2 billion for last-mile broadband infrastructure to connect unserved and underserved communities. The California Public Utilities Commission (CPUC) is required to allocate $1 billion to projects in urban counties and $1 billion in rural counties. Within those groupings, Additionally, the CPUC must initially allocate $5 million in each county before allocating the remaining funds based on their proportionate shares of unserved and underserved households.

On March 2, Commissioner Reynolds issued a proposed decision to adopt rules for this $2 billion last-mile grant program. This proposed decision must be approved by a vote of the Commission, which could occur as early as the next Business Meeting on April 7. CPUC staff anticipates they will begin to open up applications in July. Reforms passed last year make counties directly eligible for these grants.

Loan Loss Reserve Fund:

The $750 million Loan Loss Reserve Fund, also established by SB 156, will assist local governments and nonprofits secure financing for local broadband infrastructure deployment. Unlike other programs created through SB 156, the Loan Loss Reserve Fund is funded through state General Fund dollars and is not tied to the same strict timelines as the federally funded programs. Draft program rules are expected to be released in the late summer for stakeholder comment. CPUC anticipates opening funding cycles for the Loan Loss Reserve program between April and June of 2023.

Local Agency Technical Assistance:

On February 24, the CPUC issued a final decision to establish the Local Agency Technical Assistance (LATA) grant program, which was authorized by SB 156 and is funded by the federal Coronavirus State and Local Fiscal Recovery Funds.

The LATA grant program consists of $50 million to reimburse local agencies and Tribal entities for eligible pre-construction expenses to provide last-mile connections to unserved and underserved communities. Of this $50 million, at least $5 million is set-aside for Tribes. Applications for up to $500,000 per local agency per fiscal year that meet eligibility criteria will be granted ministerial approval.

CPUC staff will be conducting outreach over the next couple of months. Webinars about the grant program and application process will occur on April 5, 2022 from 10-11 a.m., and on April 19, 2022 from 10-11 a.m. Links to register for these webinars will be posted on CPUC’s website soon.

 

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