The National Telecommunications and Information Administration (NTIA) has issued guidance to broadband providers that will receive Broadband Equity, Access, and Deployment (BEAD) Program funding, telling them not to sign subgrant agreements that omit or modify required contract language and to report any state that attempts to do so.
The guidance, titled “BEAD Subgrantees: Protect Your Rights,” outlines specific contract terms that states are required to include verbatim in every subgrantee agreement. If a state omits or alters the required language, the NTIA said it is out of compliance with BEAD requirements. This puts the subgrant — and the state’s overall award — at risk. Subgrantees that encounter a non-compliant agreement are directed to notify their federal program officer.
The document covers two main areas of required contract language.
The first involves what the NTIA describes as a prohibition on utility-style rate regulation. Under the BEAD general terms and conditions, each state has committed to not enforce any law, regulation, executive order, or other obligation against a subgrantee that directly or indirectly regulates broadband rates, terms, and conditions, or that imposes net neutrality or open access rules.
The prohibition applies anywhere the subgrantee provides service within the state’s jurisdiction, for as long as the subgrant remains within its performance period. The NTIA BEAD guidance defines a net neutrality rule broadly to include any obligation that prohibits blocking, throttling, data caps, paid prioritization, or general conduct standards.
The second area covers permitting. States are required to include commitments that broadband-related permit applications will be accepted promptly and decided within 90 days, that permitting fees will reflect only reasonable costs, and that a single point of contact will be established for broadband permits.
States must also establish permitting roundtables that include federal, state, local, and Tribal representatives, and must track and report unresolved BEAD subgrantee complaints to the NTIA.
The guidance arrives at a sensitive moment in the BEAD rollout, as many states are finalizing subgrant contracts with selected broadband providers.
The timing also follows the NTIA’s earlier guidance to states on BEAD program requirements. Earlier this year, the NTIA pushed back on a SpaceX proposal seeking to release low-Earth orbit providers from various BEAD standards, reiterating in an updated FAQ that BEAD program rules cannot be altered by a subgrant agreement.
