NE Washington News

Washington, D.C. — In a recent 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 addresses concerns that NTIA is unlawfully pressuring states to regulate rates for low-cost broadband plans required by the BEAD Program. This follows a May 15, 2024, hearing at which Assistant Secretary of Commerce for Communications and Information Alan Davidson committed to increased transparency regarding BEAD funding decisions.

The committee members stated: “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.’ 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.’”

The letter further noted: “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 is unable to determine how widespread this practice is. When asked about this at oversight hearings, your responses have failed to provide clarity.”

Congress allocated $42.45 billion through the Infrastructure Investment and Jobs Act (IIJA) for NTIA's administration of the BEAD program. The program aims to ensure all Americans, particularly those in unserved or underserved areas, have access to broadband. The IIJA prohibits NTIA from rate regulation.

The IIJA established a process where each state entity must submit an Initial Proposal outlining their plan for awarding funds. The NTIA reviews these proposals before allocating funds. Some states report that approval is being conditioned on setting specific prices for low-cost broadband plans despite prohibitions against such regulations.

Although every state entity submitted their initial proposals by December 27, 2023, only 16 proposals have been approved as of this letter's date. Due to limited transparency in NTIA's review process, Congress lacks sufficient information to determine if states are being pressured into rate regulation or why so few proposals have been approved.

For more details, read the full letter addressed to Assistant Secretary Davidson.