Virginia lawmakers propose budget amendments to speed up broadband expansion

Virginia lawmakers propose budget amendments to speed up broadband expansion

Broadband access is a priority for the new administration

The new governor of Virginia, Glenn Youngkin, has pledged to connect every household and business in the state to reliable, affordable high-speed internet by the end of the decade. To achieve this goal, he has proposed a biennial budget that includes $60 million in each of the next two fiscal years from the federal Broadband Equity, Access and Deployment Program (BEAD) to help fund broadband infrastructure projectsThis is part of the $42.45 billion grant program that the Biden administration announced in June 2023 to distribute to states and territories for broadband deployment.

Utility poles are a major challenge for broadband deployment

One of the main obstacles to expanding broadband access in rural areas of Virginia is the lack of adequate utility poles to carry the fiber optic cables that deliver internet service. According to the Virginia Electric Cooperative Association, the state needs about 500,000 new or upgraded poles to support broadband expansion. However, the cost and responsibility of installing and maintaining these poles has been a source of dispute between internet service providers (ISPs), electric cooperatives, and municipal power providers.

ISPs argue that they should not have to bear the full cost of replacing or adding poles, since they are only using a portion of the pole space and the poles also benefit the electric utilities. Electric cooperatives and municipal power providers counter that they have to comply with safety and reliability standards, and that replacing or adding poles could increase the rates for their customers.The average cost of replacing a pole is about $3,000, and the cost of adding a new pole is about $5,000.

Virginia lawmakers propose budget amendments to speed up broadband expansion

Budget amendments aim to resolve the pole issue and restore VATI funding

To address this impasse, two sets of proposed budget amendments were introduced in the General Assembly on Friday, January 22, 2024. One set, filed in both the Senate and the House of Delegates, would allocate $60 million in each of the next two fiscal years from the BEAD program to help pay for the pole work. The money would be distributed to ISPs through a competitive process, and would require ISPs to match at least 25% of the grant amount.

The other set of amendments, also proposed in both chambers, would add about $29.7 million in fiscal year 2025 and about $49.7 million in fiscal year 2026 to the Virginia Telecommunication Initiative (VATI), the state’s main program for funding broadband projects. The money would come from the state’s general fund. Youngkin’s budget had removed all state funding from VATI for fiscal year 2026, but some lawmakers wanted to restore it. VATI received about $750 million of state and federal money in fiscal year 2022, creating a huge demand for broadband projects across the state.

Lawmakers and stakeholders hope for a speedy approval

The proposed budget amendments will have to be approved by the NTIA, the federal agency that oversees the BEAD program. The NTIA has given states until June 30, 2024 to submit their initial proposals for how they plan to use the BEAD funds. Once the NTIA approves a proposal, the state can request access to at least 20% of its allocated funds.

State Sen. Jennifer Boysko, D-Fairfax County, who chairs the joint Broadband Advisory Committee and filed one of the amendments, said she hoped the NTIA would approve Virginia’s proposal quickly, as broadband access is a critical need for many Virginians. “We want everybody to be made whole. We want to make sure that we’re getting the infrastructure completed so that our constituents across the commonwealth have access to broadband, so they can do their jobs, so they can do telework, so that our farms can have access to the internet and do the things that they need,” she said.

The Virginia Electric Cooperative Association, which represents 13 electric cooperatives serving more than 500,000 customers in rural areas, also expressed support for the budget amendments. “We appreciate the efforts of the governor and the General Assembly to address the pole issue and provide additional funding for broadband deployment. We look forward to working with the ISPs and the state agencies to ensure that every Virginian has access to high-quality, affordable internet service,” said Andrew Vehorn, the association’s vice president of government affairs.

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