On January 6, 2022, the U.S. Department of the Treasury issued the Final Rule for the State and Local Fiscal Recovery Funds (SLFRF) program, enacted as a part of the American Rescue Plan, which delivers $350 billion to state, local, and Tribal governments to support their response to and recovery from the COVID-19 pandemic.
The final rule, which takes effect on April 1, 2022, provides state and local governments with increased flexibility to pursue a wider range of uses and greater simplicity so governments can focus on responding to the crisis in their communities and maximizing the impact of their funds. The State and Local Fiscal Recovery Funds Program final rule provides additional clarity and flexibility for recipient governments.
The funds can now be used for many things, but we are most excited about the broadband infrastructure projects and the recognition that the old standard, 25 Mbps download/3 Mbps upload (25/3), is no longer sufficient to support the economic, education, and telehealth applications upon which households depend.
The Final Rule requires projects to deliver at least 100 Mbps symmetrical service unless there is a project where it is cost-prohibitive due to topography or geography. In these cases, the funds can be used to provide 100/20 Mbps service that can eventually scale to 100/100.
The Final Rule also recognizes the mapping issues that have plagued prior national programs, including excluding an entire census block if just one household in the block could receive the benchmark service. The program offers communities much more latitude to identify the underserved.
Another significant change is that areas that have already received an RDOF or other broadband awards are not automatically excluded, as long as the project is not redundant. For example, a community to which a satellite broadband provider has been awarded RDOF support could use ARPA funding to upgrade utility poles to support fiber to the home.
Consequently, the program can now utilize to accelerate service to significantly more households than previously anticipated, creating even greater opportunities for win-win public-private partnerships for service providers and local governments and cooperatives. And, as stated earlier, it cements the flexibility local governments have in identifying locations and structuring programs to reflect the needs and aspirations of their communities.
What Does This Mean for Broadband Providers?
In our experience, while most service providers have well defined, tested, and true processes for anticipating and responding to prior government programs, such as CAF and RDOF, the rules introduced with ARPA and anticipated to be reflected in the Infrastructure Investment and Jobs Act, are a whole new kettle of fish.
Quite simply, the diversity of government programs and the push of funding down to the state, local, and municipality levels creates an overwhelming number of grant orchestration options and program rules for service providers to address. There is a driving need to scale up the identification of eligible households, assimilation of individual grant objectives, requirements and constraints, and the priorities for the community to be served.
In short, with the magnitude of the dollars in play and the facilitation of greater competition, service providers need to dramatically scale their ability to respond with speed and quality to both expand and protect market share and revenue.
What do you need to scale?
You need a framework, a strategy, and a plan to go after available funds, with the ability to burst resources to respond quickly. Critically, the framework needs to be sophisticated enough to accurately and astutely orchestrate across the multitude of grants possibilities specific to each market and develop a network plan and proposal strategy that harnesses every dollar possible to deliver the greatest value to the community and all stakeholders.
VCTI just launched a Broadband Expansion Grant Strategy and Bid Service, expanding our already very successful Broadband Investment Optimization Services. This new service helps service providers partner with government entities to expand high-speed broadband services to underserved homes, schools, and businesses while optimizing the service provider and community’s broadband investment and grant yield.
