Washington, D.C. — In a new letter to the National Telecommunications and Information Administration (NTIA), House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-WA), Subcommittee on Communications and Technology Chair Bob Latta (R-OH), and Subcommittee on Oversight and Investigations Chair Morgan Griffith (R-VA) requested all communications between the agency and state broadband offices related to Broadband Equity, Access, and Deployment (BEAD) Initial Proposals.

The letter comes amid concerns that NTIA is unlawfully pressuring states to rate regulate low-cost broadband plans required by the BEAD Program and following a May 15, 2024, hearing at which Assistant Secretary of Commerce for Communications and Information Alan Davidson committed to being more transparent about BEAD funding decision making. 

KEY EXCERPT: 

“Based on anecdotal evidence from different entities involved in the process, it appears that the NTIA may be evaluating initial proposals counter to Congressional intent and in violation of the law. Several Members of Congress have directly raised to you that the NTIA, through its review of initial proposals, is unlawfully regulating the rate of broadband through BEAD’s low-cost service option in direct conflict with the IIJA, which states: ‘Nothing in this title may be construed to authorize the Assistant Secretary or the National Telecommunications and Information Administration to regulate the rates charged for broadband service.’9 During Senate floor debate on the IIJA, Members of Congress agreed that this language meant that ‘no rate regulation of broadband services would be authorized or permitted by the NTIA or the Assistant Secretary who leads the NTIA as part of the state broadband grant program.’”

“States have reported that the NTIA is directing them to set rates and conditioning approval of initial proposals on doing so. This undoubtedly constitutes rate regulation by the NTIA. Indeed, one state publicly posted the NTIA’s feedback that the agency would not approve their initial proposal without ’an exact price or formula’ for the state’s low-cost option. Without visibility into the approval process, Congress in unable to determine how widespread this practice is. When asked about this at oversight hearings, your responses have failed to provide clarity.” 

BACKGROUND: 

• Congress appropriated an unprecedented $42.45 billion through the Infrastructure Investment and Jobs Act (IIJA) for the NTIA to administer the BEAD program.  
• The program was intended to ensure that all Americans, specifically those in unserved or underserved areas, have access to broadband.  
• The NTIA is responsible for managing and distributing this money to the states and territories. 
• The IIJA prohibits the NTIA from rate regulation. 
• The IIJA established a process for how states receive money from the NTIA for this program.  
• First, each of the 56 individual states and territories (state entities) were required to submit an Initial Proposal explaining their proposed process for awarding the funds.  
• The NTIA was then tasked with reviewing and approving each individual states entities’ proposal, after which funds would be allocated to the state to award.  
• Some states report that the NTIA is conditioning approval of their Initial Proposals on setting a specific price for low-cost broadband plans despite the prohibition on rate regulation. 
• Despite every state entity having submitted their initial proposals by the December 27, 2023, deadline, the NTIA has only approved 16 initial proposals as of the date of this letter.  
• Due to the opaque nature of the NTIA’s review and approval process, the Committee lacks the information necessary to assess whether NTIA is pressuring states to rate regulate and to understand why so few state entities initial proposals have been approved to move forward. 

CLICK HERE to read the full letter to Assistant Secretary Davidson.