On his first day in office, President Donald Trump signed an executive order that put a pause on the disbursement of federal funds meant for infrastructure projects. These funds were earmarked by the Biden administration and include significant investments in broadband expansion. Given this sudden change, the future of these infrastructure efforts has become uncertain.
The executive order, one of nearly 100 actions Trump took on his initial day, mandates federal agencies to immediately halt the distribution of funds allocated through two crucial legislative acts: the Inflation Reduction Act of 2022 and the Infrastructure Investment and Jobs Act of 2021. One significant program under threat due to this pause is the Broadband Equity, Access, and Deployment (BEAD) program. BEAD was a major element of the Biden-Harris administration’s “Internet for All” initiative and planned to allocate $42.45 billion to states to enhance access to affordable, high-speed internet—part of a larger $65 billion broadband investment.
Impact on the BEAD Program
Uncertainty for States Awaiting Approval
The “Internet for All” initiative encompassed several other programs, including three digital equity grant funds and the “middle-mile” fund, which are further along in their disbursement processes. These programs are less likely to be significantly impacted by Trump’s order. However, for BEAD, especially in states that have not yet received final approval for their funding proposals by the National Telecommunications and Information Administration (NTIA), the effects remain unknown.
Jennifer Hickerson, a senior manager specializing in telecommunications at Moss Adams, described Trump’s motivations for pausing the BEAD program as a “mixed bag.” She emphasized that the impact will largely depend on who Trump appoints to lead the NTIA. Alan Davidson, who has served as the NTIA administrator since January 2022, stepped down recently, making room for a potential new leader that could reshape the program’s direction.
Speculation on New NTIA Leadership
There is speculation that Arielle Roth, telecommunications policy director for Sen. Ted Cruz, might be Trump’s pick for NTIA administrator. Senator Cruz has previously criticized the BEAD program, labeling it as “unlawful” and a “boondoggle” in November 2022. StateScoop attempted to verify this rumor but received no confirmation.
By the end of 2023, all 56 states and territories had submitted their initial proposals for the BEAD program, but only three states—Delaware, Louisiana, and Nevada—had selected internet service providers and received final approval for their funding proposals. These states can theoretically proceed with awarding funds and initiating projects, unless further restrictions are imposed.
State Responses and Potential Delays
Delaware’s Proactive Monitoring
Delaware responded to inquiries from StateScoop, indicating that the state’s Broadband Office is closely monitoring the situation and awaiting guidance from the NTIA. Other states, however, must now navigate through additional hurdles in obtaining BEAD funds. The process involves selecting eligible ISP entities for sub-grants, which may take longer if the order leads to procedural adjustments.
Hickerson pointed out that the best-case scenario might see only a slight delay in these processes, with states continuing to operate from their pre-established frameworks. Yet, there may be requests for procedural changes. The Trump administration might, for example, seek to eliminate the waiver for the BEAD program’s “Build America, Buy America” rules, which currently allow some exceptions for equipment and materials not produced in the United States.
Alternative Technology Considerations
The BEAD program also includes provisions for alternative technologies in scenarios where deploying fiber is financially unfeasible. One such option is Low Earth Orbit (LEO) satellite technology, like Starlink, a service operated by SpaceX and owned by Elon Musk. Musk has recently been named by Trump to lead his Department of Government Efficiency, which may influence the prioritization of such technologies under BEAD.
States like Louisiana and Nevada have already allocated BEAD funds toward alternative technology providers. Louisiana, for instance, allocated $28.7 million to cover approximately 2,900 locations with an unnamed provider, likely either Starlink or Amazon’s Project Kuiper; both providers have received pre-approval. Nevada has similarly awarded funds to Project Kuiper. Other states, including New Mexico and Maine, are contemplating similar deployments. Virginia made headlines as one of the first states to offer its localities satellite internet service from Starlink.
Future of Broadband Expansion
Influence of Elon Musk
There are rumors that Arielle Roth, who serves as the telecommunications policy director for Senator Ted Cruz, could be President Trump’s choice for the NTIA administrator role. Senator Cruz has taken a critical stance on the BEAD program, labeling it in November 2022 as “unlawful” and a “boondoggle.” StateScoop reached out to verify these rumors but did not receive any confirmation.
By the close of 2023, all 56 states and territories had submitted their initial plans for the BEAD program. However, only three states—Delaware, Louisiana, and Nevada—had chosen internet service providers and secured final approval for their funding proposals. These states are, in theory, ready to start awarding funds and commencing projects, provided no additional restrictions are enforced. The approval process appears slow-moving, as most states have yet to move beyond the initial proposal stage, raising concerns about the efficiency and future of the BEAD program amidst regulatory and administrative complications.