Treasury Guidance on Broadband Funds Leans Toward High Speeds, Low Prices

Interim guidelines from the U.S. Treasury on COVID-19 relief funds includes prioritizing rural broadband delivered by electric co-ops. (Photo Courtesy: Tipmont REMC)

Interim guidance by the U.S. Treasury on how $350 billion in COVID-19 relief funds may be used for rural broadband recognizes the role electric cooperatives can play and the importance of affordable, future-proof internet access.

“Although it is early in the process, we are pleased by how the temporary guidelines from Treasury may help deploy broadband to unserved rural communities,” said Brian O’Hara, NRECA senior regulatory director.

“We look forward to ensuring co-ops and the communities they serve get a fair opportunity to benefit from these relief funds as the department prepares to finalize its guidance in the weeks ahead.”

The Treasury Department released the interim guidance May 10 to facilitate disbursement of $219 billion in state and $130 billion in local government recovery funds from the $1.9 trillion American Rescue Plan Act.

Under the proposed guidance, funds may cover broadband deployment costs incurred from March 3 of this year through 2024. Eligible projects would serve areas without reliable wireline connections of at least 25/3 megabits per second download/upload. Treasury officials included electric co-ops among those that should have priority to receive funds.

NRECA has summarized the Treasury guidance and outlined several key components, including:

  • Eligible projects should deliver at upload/download speeds of at least 100/100 Mbps.
  • Fiber optic infrastructure should be prioritized where feasible.
  • Last-mile broadband connections to homes and businesses are encouraged.
  • Internet providers receiving funds are encouraged to make the service affordable.
  • Assistance to hard-hit households in need of internet access or digital literacy is an eligible use of funds.

In April, NRECA CEO Jim Matheson urged Treasury Secretary Janet Yellen to issue guidelines that support broadband for rural America and to reject recommendations from large telecom providers that would disadvantage remote, economically challenged regions.

“Any restriction, no matter how well intended, has the potential to create winners and losers and is likely to result in rural communities being further left behind in the digital economy,” he wrote.

Cathy Cash is a staff writer for NRECA.