In his previous work in the elections field, North Dakota State Broadband Program Director Brian Newby saw reactions to the elections system that, now, remind him of some states’ reactions to the new guidance for the Broadband Equity, Access, and Deployment (BEAD) Program.
In elections, as in BEAD, some people believe that if they can just tell their story compellingly, they can persuade the agency to change its rules. “But [those in charge] don’t care,” Newby told Telecompetitor this week. Newby prefers not to beat his head against a federal agency over which he has no control. “Just tell me the rules. We’ll follow the rules.”
Officially, North Dakota only has about 2,000 locations left without broadband, though Newby thinks that after the bogus broadband locations are removed, the number may be closer to 1,000. Those locations are spread throughout the state — Newby and his team call them “Swiss cheese locations” — and, as a result, the state didn’t receive many BEAD applications when their application window first opened.
“There must be two types of states,” Newby said. Some “have a crazy number of bidders. And then I think there’s a fair number of states like us, where we’ve just had two bidders.”
Newby said North Dakota hopes their “Benefit of the Bargain” round — as defined in the new BEAD guidelines — is finished by early July so their final proposal can be completed by early September.
“We’ve sent out the notice for unlicensed fixed wireless, and we haven’t had anyone respond,” Newby said. “There may be one unlicensed fixed wireless provider in North Dakota, but I don’t know that that’ll be a thing for us.”
Newby hopes the two providers who originally bid for — and were preliminarily selected for — BEAD funds will bid again. “Now that they know this is kind of a final round, they may look at the state and see if there are [other locations] they want to bid on.”
He said he’s hearing rumors that NTIA may grant another extension on the timeline, but he hopes they won’t. “If you’re going to create this new process and hurry it along, let’s do it. If we’re going to charge ahead to September 4, we’d like to see it [happen] because that will help make sure that they look at it in 90 days. I think that will be the real push — I think it’s going to be really hard for [NTIA] to approve things in 90 days.”
Newby also expressed concern that BEAD nondeployment funds for North Dakota and other states will disappear. “I wasn’t surprised that the nondeployment funds were put on hold, but I don’t know what’s going to happen with them,” Newby said.
“They’re passing a budget bill at the same time, and they get into rooms and try to find money. And I could see someone seeing the $20 billion line item for nondeployment and saying the money that isn’t spent on deployment should be given back to help address the deficit the new tax bill causes. That’s kind of what I’m expecting to occur.”
Fiber or Not?
Thanks to the work of its providers, North Dakota has long been a fiber-forward state. Newby said it’s unclear how much that may change for the state’s remaining locations.
Newby said the cost of fiber has become a political issue. He referred to the new BEAD guidelines, which say: “Nevada’s Extremely High Cost Per Location Threshold set at $200,000, for example, resulted in a Final Proposal that included 24 project areas with a per-BSL cost of $100,000 or more. This is an unjust and unfair expenditure of taxpayer dollars that this Administration simply will not let stand.”
Howard Lutnick referred to this section of the guidelines in his testimony to the U.S. Senate Appropriations Committee earlier this month, Newby said.
Lutnick “compared a $100,000 [fiber] line to a house that cost $100,000. But those things are independent; they have nothing to do with each other. If it were a million-dollar home, would $100,000 be [an acceptable cost for a fiber connection]? But if it were only a $25,000 house, they’d have to make it lower?” Newby said these types of arguments are used to “inflame” the dialogue around broadband expansion.
That said, Newby said the cost-per-location of the bids they had to rescind — for the two providers who were preliminarily selected for BEAD funding, as referenced above — were roughly the same as projects they did through the U.S. Treasury Capital Projects Fund a couple of years ago.
“So, my argument there would be: a different agency in the federal government accepted those [numbers], so these would seem to be in the range of reasonableness.”
That said, he also thinks that, since the new BEAD guidelines are technology-neutral, some of the providers who bid before “may propose to reach some locations with fixed wireless where they might have done fiber otherwise. I don’t know what they’re thinking.”
Newby said the state had an introductory conversation with a low Earth orbit (LEO) satellite broadband provider — “probably about a month ago at this point” — but he doesn’t know whether any LEO companies will bid for North Dakota BEAD funds.
If satellite providers successfully bid on BEAD in North Dakota, it will raise new issues for the state, given the new guidelines’ requirements that LEO providers guarantee 10 years of performance. “If you have to monitor for another 10 years for a small number of locations, it impacts financials in terms of how much use on [administrative costs],” Newby said.
In the end, Newby thinks some locations may simply not receive a bid. “I asked the old NTIA this — and it’s still a question: If you don’t have anybody bid for a location, what do you do? Do you just go back and say, ‘We tried’?” He said he thinks every state may face this question eventually.
“Every state’s going to have some little scraps here or there. What do they do? And who’s going to bid on them? So, we’ll reach 99.9% fiber, maybe.”
For now, Newby is waiting to see who bids for North Dakota BEAD funds in the upcoming funding round. “We’re open for business.”
Additional information about North Dakota broadband, including state funding resources, awards made, BEAD news, state-specific coverage, and more can be found on the Telecompetitor Broadband Nation webpage for the state.
